Cross-border M&As: Theorizing the negative effect of political ideology mismatch with host country labor institutional context on employee outcomes

Abstract

Negative employee behaviors (e.g., turnover and workplace deviance) can be pronounced during cross-border mergers and acquisitions (M&As), and they are often linked to their failure and suboptimal performance. Yet, thus far, M&A research has primarily focused on cultural clashes to account for such negative outcomes. Drawing on a multilevel perspective of role theory, we offer a conceptual framework that emphasizes the distinctiveness of cross-border M&As. We theorize how political ideology mismatch triggers psychological mechanisms that have important effects on employees’ attitudes and behaviors, and how the types of M&As and organizational justice perceptions could influence these psychological mechanisms. We contribute to advancing knowledge on employee outcomes in cross-border M&As by shedding light on how micro-relational dynamics interact with contextual factors to shape employees’ turnover and deviant workplace behaviors.