The influence of social embeddedness on organizational legitimacy and the sustainability of the globalization of the sharing economic platform: Evidence from Uber China

Abstract

Sharing vehicles and the transportation sharing economy (SE) more generally can help to provide a solution to the sustainable development challenges that arise in societies with a high population density, such as China. The transportation SE alleviates ecological problems as it makes use of idle vehicles and reduces the consumption of consumer resources. The globalization of the SE platform helps to illustrate how the ecosystem can obtain organizational legitimacy and be maintained through social embeddedness. Our case study focuses on a multinational vehicle sharing company on an economic platform, Uber China. The data for this study were obtained from second-hand sources as well as semi-structured interviews with the stakeholders engaged in Uber China’s ecosystem. Our findings demonstrate that Uber China’s social embeddedness process exerts an impact on its sustainable development in China. Uber China’s ecosystem was organized on the basis of its dual home-country advantage and international image, which helped to maintain a balance between different social ties during the early stages of its development. However, its failed attempt to achieve local embeddedness hampered the success of its sustainable business model during the development period. This study reveals the importance of social embeddedness (cognitive, cultural, historical, and structural) to the acquisition of organizational legitimacy and the sustainability of a platform’s globalization.