When Do Ethnic Communities Affect Foreign Location Choice? Dual Entry Strategies of Korean Banks in China

Li, Yong; Hernandez, Exequiel; Gwon, Sunhwan

doi:10.5465/amj.2017.0275

Cited by 68 publications

(79 citation statements)

References 70 publications

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“…We demonstrate that research needs to consider an institutional perspective on both ends of migration: where people come from and where they go, and that migration is (similar to distance) a twoend-point construct. Although recent literature has highlighted the importance of the institutional environment for immigrants' knowledge flows (Li et al, 2019;Shukla & Cantwell, 2018), we believe this paper is among the first to connect the two end-points in a coherent conceptual model on a high level of granularity and based on a consistent theoretical angle. This paper also leads to numerous policy implications.…”

Section: Discussionmentioning

confidence: 98%

“…For example, Shukla and Cantwell (2018) discuss the importance of the institutional environment for how immigration influences knowledge flows between the home and the host country. Also, Li, Hernandez, and Gwon (2019) introduce an institutional lens into migration research and propose under which institutional conditions, positive migration effects are most beneficial. In Hypothesis 2, we suggest that the value of immigrants' hostcountry knowledge to internationalizing firms is limited in unstable host-country conditions.…”

Section: Discussionmentioning

confidence: 99%

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Benefitting from immigration: The value of immigrants’ country knowledge for firm internationalization

2019

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Migrants are able to provide firms with knowledge about their country of origin. This can become a valuable source of knowledge for firms in the process of internationalization. Relating to a Knowledge-Based-View perspective, this paper explains how the resource commitment of firms to foreign countries is contingent on immigration from those countries: Immigrants' country knowledge reduces uncertainty and makes the governance of foreign operations more efficient. Moreover, this paper connects the relevance of knowledge for firm internationalization to institutional characteristics in immigrants' home and host countries, both of which policymakers can shape. We test predictions on more than 13,000 observations over a 14-year period (2003-2016). The paper identifies economically significant contingencies of a positive effect of immigration, which are robust to changes in model specification, measurement, and sampling. The results indicate how immigration can shape firms' investments abroad and have implications for developing policy as well as international business theory.

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Section: Discussionmentioning

confidence: 98%

Section: Discussionmentioning

confidence: 99%

Benefitting from immigration: The value of immigrants’ country knowledge for firm internationalization

2019

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“…This choice set, however, may include irrelevant options for some FDIs. In supplementary analyses, we constructed new choice sets by including only the countries and regions that received at least one FDI from Chinese firms in the year prior to a specific FDI (Li, Hernandez, & Gwon, ). Reported in Table A2 of Appendix S1, the results are highly consistent with those reported in Table .…”

Section: Supplementary Analysis I: Addressing the Issue Of Unobservedmentioning

confidence: 99%

“…Moreover, consistent with previous studies on the same topic (e.g., Belderbos et al, 2011;Chang & Park, 2005;Li et al, 2019), we treated all foreign countries/regions that received at least one Chinese FDI in 2001 in the prior year) as potential destinations for entry FDI in the sample. However, firms likely consider a much smaller choice set in their FDI location decisions.…”

Section: Limitations and Future Research Directionsmentioning

confidence: 99%

Navigating geographic and cultural distances in international expansion: The paradoxical roles of firm size, age, and ownership

Zhang

Shi

2019

Strategic Management Journal

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Research Summary While geographic and cultural distances deter firms' international expansion, they do so via different mechanisms, such that firms with advantages in overcoming one‐dimension may face disadvantages in overcoming the other. Larger, older, and state‐owned firms have better access to resources in their home countries than smaller, younger, and non‐state‐owned firms, and thus are less concerned about the high operating costs associated with larger geographic distances. However, they are less adaptable to culturally distant countries and thus are more concerned about larger cultural distances. We propose that firm size, age, and state ownership weaken the deterrent effect of geographic distance while amplifying the deterrent effect of cultural distance. Results using data on Chinese firms' location choices of foreign direct investments in 2001–2013 support our predictions. Managerial Summary A key decision that managers need to make in expanding overseas is the foreign location choice. Although managers generally refrain from expanding to geographically and culturally distant countries, the importance of geographic and cultural distances in their consideration varies across firms, which tend to differ in resource endowment and adaptability. Because larger, older, and state‐owned firms are better positioned to absorb additional operating costs but are less adaptable to foreign countries' local environments than smaller, younger, and non‐state‐owned firms, the deterrent effect of geographic distance (cultural distance) is weaker (stronger) for the former than for the latter. Our findings show that foreign countries that seem to be good fits when considering geographic distance may be misfits when considering cultural distance, and vice versa.

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“…Finally, my study complements research in strategy on immigrant entrepreneurs. Recent work has shown that local ties factor into the choices of immigrant firm owners (Hernandez, 2014; Kulchina, 2016; Li, Hernandez, & Gwon, 2019), but has not addressed how migrants' global ties shape their tendency to become founders.…”

Section: Introductionmentioning

confidence: 99%

When do return migrants become entrepreneurs? The role of global social networks and institutional distance

Wang

2020

Strategic Entrepreneurship

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Research Summary: Does embeddedness in global social networks elevate or diminish individuals' propensity to found new ventures? I analyze entrepreneurial entry among a large, cross-country sample of skilled return migrants, all of whom had worked abroad in the United States before returning to 98 different home countries. My findings reveal that maintaining stronger cross-border social ties-that is, relationships to former colleagues abroad-leads returnees to be more likely to found new ventures in their homelands. However, the positive effects of cross-border social ties diminish with greater institutional distance between the returnee's home country and the United States. The findings have implications for research at the intersection of social networks, international migration, and entrepreneurship. Managerial Summary: When it comes to founding a venture, social networks are often critical in helping prospective entrepreneurs identify new market opportunities and resources. Which types of networks are most beneficial in helping people become entrepreneurs, however, still remains a question. This paper asks whether having social connections to individuals across countries makes one more likely to become an entrepreneur, and if so why? Studyingskilled return migrants, I find that returnees who maintain stronger social ties to those they met while working abroad are more likely to start companies, but only if there is sufficient similarity between the market environments of the

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When Do Ethnic Communities Affect Foreign Location Choice? Dual Entry Strategies of Korean Banks in China

Cited by 68 publications

References 70 publications

Benefitting from immigration: The value of immigrants’ country knowledge for firm internationalization

Benefitting from immigration: The value of immigrants’ country knowledge for firm internationalization

Navigating geographic and cultural distances in international expansion: The paradoxical roles of firm size, age, and ownership

When do return migrants become entrepreneurs? The role of global social networks and institutional distance

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