A Missing Link in Going Global: How Emerging Economy Firms Can Compete Abroad?

A Missing Link in Going Global: How Emerging Economy Firms Can Compete Abroad?

Integrating resource- and institution-based views as well as the agency theory, this paper examines the effect of international expansion on performance for emerging economy firms, and further explains the mechanisms through which emerging economy firms can better compete with global players in their international expansion process. Based on a sample of firms in China, the hypotheses were empirically tested Findings revealed that these firms are more likely to benefit from a premium in their international expansion. It was also demonstrated that institutionally determined firm characteristics, namely, state ownership and CEO ownership, play an important role in moderating the performance outcomes of international expansion in emerging economy firms. The contribution of this research to the extant literature is seen through the enhancement of understanding as to whether international expansion matters for emerging economy firms and how these firms can better compete in international markets.