Employment and market innovation in Chinese business group affiliated firms: The role of group control systems

Prior research has suggested a number of potential benefits to firm membership in business groups. These benefits include availability of capital and other resources not readily accessible in an open market, the facilitation of entrepreneurship, plus information and risk sharing advantages. We sugge...

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Main Authors: WHITE, Robert E., HOSKISSON, Robert E., YIU, Daphne W., BRUTON, Garry D.
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Language:English
Published: Institutional Knowledge at Singapore Management University 2008
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Online Access:https://ink.library.smu.edu.sg/lkcsb_research/7321
https://ink.library.smu.edu.sg/context/lkcsb_research/article/8320/viewcontent/employment_and_market_innovation_in_chinese_business_group_affiliated_firms_the_role_of_group_control_systems.pdf
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spelling sg-smu-ink.lkcsb_research-83202023-11-10T07:48:30Z Employment and market innovation in Chinese business group affiliated firms: The role of group control systems WHITE, Robert E. HOSKISSON, Robert E. YIU, Daphne W. BRUTON, Garry D. Prior research has suggested a number of potential benefits to firm membership in business groups. These benefits include availability of capital and other resources not readily accessible in an open market, the facilitation of entrepreneurship, plus information and risk sharing advantages. We suggest that another important benefit is the assistance of group control systems in helping the firm to manage conflicting pressures in the institutional environment and facilitate coevolution of these conflicting pressures. To empirically demonstrate the relevance of this viewpoint, we examine the case of China where business groups facilitate institutional transition, actively balancing market pressures to increase levels of innovativeness in firms with institutional pressures emanating from the government to maintain high employment levels. Using data from a broad sample of more than 1,000 Chinese affiliate firms in more than 200 business groups, we find that government policy, ownership and managerial mindset influence the political goal of maintaining high employment levels, while interdependence among group affiliate firms is related to lower employment levels. However, while government ownership and the government managerial mindset were negatively related to market innovation activities, group financial and cultural control systems positively affected the tendency of affiliate firms to focus on market innovation. 2008-07-01T07:00:00Z text application/pdf https://ink.library.smu.edu.sg/lkcsb_research/7321 info:doi/10.1111/j.1740-8784.2008.00107.x https://ink.library.smu.edu.sg/context/lkcsb_research/article/8320/viewcontent/employment_and_market_innovation_in_chinese_business_group_affiliated_firms_the_role_of_group_control_systems.pdf http://creativecommons.org/licenses/by-nc-nd/4.0/ Research Collection Lee Kong Chian School Of Business eng Institutional Knowledge at Singapore Management University Business groups; China; Control systems; Innovation; Institutional theory Business Technology and Innovation
institution Singapore Management University
building SMU Libraries
continent Asia
country Singapore
Singapore
content_provider SMU Libraries
collection InK@SMU
language English
topic Business groups; China; Control systems; Innovation; Institutional theory
Business
Technology and Innovation
spellingShingle Business groups; China; Control systems; Innovation; Institutional theory
Business
Technology and Innovation
WHITE, Robert E.
HOSKISSON, Robert E.
YIU, Daphne W.
BRUTON, Garry D.
Employment and market innovation in Chinese business group affiliated firms: The role of group control systems
description Prior research has suggested a number of potential benefits to firm membership in business groups. These benefits include availability of capital and other resources not readily accessible in an open market, the facilitation of entrepreneurship, plus information and risk sharing advantages. We suggest that another important benefit is the assistance of group control systems in helping the firm to manage conflicting pressures in the institutional environment and facilitate coevolution of these conflicting pressures. To empirically demonstrate the relevance of this viewpoint, we examine the case of China where business groups facilitate institutional transition, actively balancing market pressures to increase levels of innovativeness in firms with institutional pressures emanating from the government to maintain high employment levels. Using data from a broad sample of more than 1,000 Chinese affiliate firms in more than 200 business groups, we find that government policy, ownership and managerial mindset influence the political goal of maintaining high employment levels, while interdependence among group affiliate firms is related to lower employment levels. However, while government ownership and the government managerial mindset were negatively related to market innovation activities, group financial and cultural control systems positively affected the tendency of affiliate firms to focus on market innovation.
format text
author WHITE, Robert E.
HOSKISSON, Robert E.
YIU, Daphne W.
BRUTON, Garry D.
author_facet WHITE, Robert E.
HOSKISSON, Robert E.
YIU, Daphne W.
BRUTON, Garry D.
author_sort WHITE, Robert E.
title Employment and market innovation in Chinese business group affiliated firms: The role of group control systems
title_short Employment and market innovation in Chinese business group affiliated firms: The role of group control systems
title_full Employment and market innovation in Chinese business group affiliated firms: The role of group control systems
title_fullStr Employment and market innovation in Chinese business group affiliated firms: The role of group control systems
title_full_unstemmed Employment and market innovation in Chinese business group affiliated firms: The role of group control systems
title_sort employment and market innovation in chinese business group affiliated firms: the role of group control systems
publisher Institutional Knowledge at Singapore Management University
publishDate 2008
url https://ink.library.smu.edu.sg/lkcsb_research/7321
https://ink.library.smu.edu.sg/context/lkcsb_research/article/8320/viewcontent/employment_and_market_innovation_in_chinese_business_group_affiliated_firms_the_role_of_group_control_systems.pdf
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