Quotation Shirodkar, Vikrant and Mohr, Alexander. 2015. Explaining foreign firms' approaches to corporate political activity in emerging economies: The effects of resource criticality, product diversification, inter-subsidiary integration, and business ties. International Business Review 24 (4), 567-579.


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Abstract

Despite the increasing scope for transactional approaches to corporate political activity (CPA) in emerging markets and rising concerns about the use of relational approaches, foreign firms in emerging economies appear to be reluctant to adopt transactional approaches to CPA. Using Resource Dependence theory we argue that criticality of resources, product diversification, integration with other foreign subsidiaries, and business ties may explain why foreign firms adopt a transactional or a relational approach to CPA. We test our hypotheses using a sample of 105 subsidiaries of foreign firms in India. We find that unrelated diversification and close integration with other subsidiaries of their parent firm makes subsidiaries more likely to adopt a transactional approach, whereas local resource criticality and ties to local businesses makes subsidiaries less likely to use a transactional approach to CPA. Our findings enhance our understanding of the factors that determine foreign firms’ choice of approaches to CPA in emerging economies.

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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Journal article
Journal International Business Review
Citation Index SSCI
WU Journalrating 2009 A
WU-Journal-Rating new STRAT-B, WH-B
Language English
Title Explaining foreign firms' approaches to corporate political activity in emerging economies: The effects of resource criticality, product diversification, inter-subsidiary integration, and business ties
Volume 24
Number 4
Year 2015
Page from 567
Page to 579
Reviewed? Y
DOI http://dx.doi.org/10.1016/j.ibusrev.2014.10.014

Associations

People
Mohr, Alexander (Details)
External
Shirodkar, Vikrant (University of Sussex , United Kingdom)
Organization
Institute for International Business (Details)
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