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Internationalization of Private Enterprises in China: The Effect of Competitive Advantages and Disadvantages Compared to Home Market Rivals

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Intellectual Contribution by Lihua Wang

Contribution Title

Internationalization of Private Enterprises in China: The Effect of Competitive Advantages and Disadvantages Compared to Home Market Rivals

Conference

Conference fo International Association of Chinese Management Research

Year

2010

Description

This study uses the resource-based view of a firm to examine the outward internationalization of private firms in the Chinese transition economy. We investigate the extent to which advantages/disadvantages of resource endowment and organizing capability of private enterprises in China (relative to both state-owned enterprises and foreign-invested enterprises) may drive outward internationalization and affect whether firms tend to take a low-risk or high-risk alternative when going international. Our analyses of 553 Chinese private enterprises show that a Chinese private firm's likelihood of venturing aboard is associated with resource endowment advantages vis-_-vis foreign-invested enterprises, organizing capability advantages vis-_-vis state-owned enterprises, and organizing capability disadvantages vis-_-vis foreign-invested enterprises. These same advantages (or disadvantages) in organizing capabilities also increase a firm's likelihood of choosing a high-risk entry mode. We also find that a firm's resource endowment facilitates its effort of exploiting or upgrading its capabilities through outward internationalization.

Complete Citation

Liang, Xiaoya, Lu, Xiongwen, and Wang, Lihua. "Internationalization of Private Enterprises in China: The Effect of Competitive Advantages and Disadvantages Compared to Home Market Rivals." Presented at 2010 International Association of Chinese Management Research, Shanghai, China, June 2010.

Website

See Faculty: Lihua Wang

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