Abstract
This study develops an institutional arbitrage perspective regarding the strategic drivers behind the foreign listings of emerging economy firms (EEFs). Drawing on an institution-based view of strategy and an agency perspective of government, we argue that if a firm has higher exposure to government expropriation, as reflected in the firm’s level of private/foreign ownership, it will more likely to pursue a foreign listing in developed markets to gain additional investment protection. Using a sample of listed firms from China, we found incremental explanatory power of private/foreign ownership over finance-based perspectives in predicting foreign listing. These effects were lessened if the firm had a politically-connected CEO, and strengthened if the level of subnational government intervention was higher.
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