Home institutions, internationalization and firm performance: Evidence from listed Chinese firms

Abstract

Purpose

The purpose of this paper is to examine how home institutions moderate the influence of internationalization, and the effect this has on the performance of stock-listed Chinese firms.

Design/methodology/approach

A sample of 118 stock-listed Chinese firms over the period 2006-2011 was considered, using the panel data method.

Findings

The results show that foreign ownership and region-specific marketization help firms reap the performance benefits of internationalization, while state ownership plays an insignificant role.

Research limitations/implications

The findings may not hold for unlisted firms, service firms or firms from other emerging economies.

Practical implications

The study suggests that Chinese managers should take advantage of home country institutions to improve the effects of internationalization on performance.

Originality/value

This research suggests that the analysis of the performance consequences of internationalization should go beyond the nexus between internationalization and performance, and also consider the home institutional factors that may facilitate or constrain the focal relationship.

Citation

Chen, Y., Zhai, R.-R., Wang, C. and Zhong, C. (2015), "Home institutions, internationalization and firm performance: Evidence from listed Chinese firms", Management Decision, Vol. 53 No. 1, pp. 160-178. https://doi.org/10.1108/MD-05-2014-0311