No Place like Home? How EMNCs detach from hyper turbulent contexts

Abstract

Using comparative case histories of 12 firms over 12 years we theorize how emerging market multinational companies (EMNCs) born or based in hyper turbulent contexts internationalize by sequentially arbitraging rents, values, and scales abroad. We first problematize the role of home context through a review of extant theories of institutional arbitrage to reveal distinct motivations and matching criteria depending on the (in)stability EMNCs experience in their country. We then inductively derive specific sets of practices by which EMNCs use institutional arbitrage to mitigate the rapid and radical deterioration of their place of doing business and group these practices in three sequential modes. Combining multi-modal historical analyses and longitudinal comparative case methodologies to study the co-evolution of institutional arbitrage modes and home context, we show how the sequence of rent-, value-, and scale- centric institutional arbitrage progressively erodes both the protective and the expressive attributes of home by triggering repeated revisions in EMNCs’ risk preferences and opportunity references.