Characteristics Of Institutional Environment Research Articles

Financial Resources and New Venture Growth: Effects of Venture Origin and Institutional Environment

Financial resources are generally known to have a positive impact on new venture growth, but various conditions may play complex roles on this relationship. This study investigated the roles of venture origin and characteristics of institutional environment in the context of the relationship between financial resources and growth of new ventures. We posit that financial resources are more critical for independent ventures (IVs) compared to corporate ventures (CVs), because IVs have more discretion and greater incentives for growth and leading them to use financial resources more extensively than CVs. Furthermore, we posit that financial resources are more critical for IVs’ growth in market-oriented institutional environment than in government-driven institutional environment, because market-oriented institutional environment requires more discretional resource management for IVs and thus financial resources should play more critical roles in market-oriented institutional environment. We find broad support for these arguments in a comprehensive data set representing South Korean new venture firms from 1991 to 2009.

Does market digitalization always benefit firms? The Latin American case

PurposePrior research has found that firms' adoption of digital technologies (i.e. digitalization) enhances transaction efficiency and improves firm performance. However, this finding is based on the assumption that firms respond to consumers' adoption of digital technology (market digitalization) in a timely fashion. The study investigates the impact of market digitalization on firm performance in Latin America, where resistance to change is often higher, despite the positive impact on performance when companies respond to the environmental shock of digitalization by restructuring.Design/methodology/approachUsing data from seven Latin American countries from 1997 to 2018 (Argentina, Brazil, Chile, Colombia, Peru, Venezuela and Mexico), fixed-effects panel regression robustly supports the results.FindingsMost Latin American firms fail to capitalize on the benefits of market digitalization, and their performance declines as a result. The authors extend research on digitalization by incorporating theoretical insights from the restructuring literature, finding that implementing a substantial restructuring strategy is a viable way to overcome market digitalization.Originality/valueThe authors demonstrate that the digitalization–firm performance relationship is more complex than has been described in studies using samples from developed economies. The authors establish restructuring as an effective adaptation strategy in Latin America, although the institutional environment's characteristics may constrain or discourage firms from adopting it.

Does Media Attention Lower Debt Financing? International Evidence

ABSTRACT This article examines the association between media attention and debt financing through a number of channels associated with information asymmetry reduction and whether this relationship changes with cross-country institutional environment characteristics. Focusing on a comprehensive international dataset, we find that overall media coverage is negatively related to firm leverage levels. Media-focused variables directly associated with information asymmetry levels, including press-initiated news, non-financial news, and the extent of positive news sentiment, are also negatively related to firm leverage ratios. Furthermore, the country-level institutional environment provided a substituting rather than legitimizing influence on the relationship between media news coverage and firm financing decision-making.

REGIONAL DEVELOPMENT AND INSTITUTIONAL ENVIRONMENT: REGIONAL EXPANSION OF FRANCHISE CHAINS IN BRAZIL

ABSTRACT Purpose: This paper aims to analyze the attractiveness of the markets in the inland of Brazil to franchise chains based on the characteristics of institutional environment, referring to the socioeconomic, geographical, and human resources dimensions. Originality/value: Interiorization is a theme that has been hardly explored in franchise chains’ growth strategies. This paper contributes to this debate through the institutional theoretical perspective, contributing to the clarification and ordering of the decision-making factors for the regional expansion of franchises. For regional development, it calls for municipal management to direct actions aimed at socioeconomic development and human resources. Design/methodology/approach: The quantitative method using secondary data - from Brazilian Association of Franchising (Associação Brasileira de Franchising [ABF]), Brazilian Association of Shopping Centers (Associação Brasileira de Shopping Centers [Abrasce]), Brazilian Institute of Geography and Statistics (Instituto Brasileiro de Geografia e Estatística [IBGE]) and Google Maps - was employed in this study for the analysis of franchise location and for municipalities. The sample comprised 458 municipalities with a populaion of above 50 thousand inhabitants. The statistical techniques used were factor analysis and multiple regression analysis. Findings: The results show that the socioeconomic and human resources factors of the municipalities are essential for the attractiveness of franchises chains to the inland of the country. In turn, the geographical distance of the inland municipality in relation to the state capital did not present adherence to the model as an explanation for the attraction of franchises.

Investigation of cross-cultural distinctions effect on the consumers' behavior in the higher education market

The article states that the investigations of the cross-cultural distinctions effect on the consumer behaviour are challenging and popular in the international scientific and business community and are of the interdisciplinary character. The objective of this investigation is to develop the methodological approach to the assessment of the cross-cultural features impact on the consumers’ behaviour in the higher educational services market. The culture model disclosing the list of the cultural values, material and institutional environment characteristics, adapted to the Universities educational services market, was developed during this investigation. The method for creating the contingency matrix of the elements, forming the model of a certain country consumers’ culture, and the consumers (students) behavioural features in the market of the higher educational services grouped against the 7P complex (Product, Price, Promotion, People, Process, Physical evidence) has been suggested. The developed methodical approach has been approved by Chinese and Russian students. The investigation outcomes can be used to develop the measures to improve the international competitiveness of universities.

How organizational slack affects new venture performance in China: a contingent perspective

PurposeThe purpose of this paper is to investigate the relationships between organizational slack, environmental characteristics, and new venture performance in China. The paper focuses on how different types of organizational slack, such as absorbed slack and unabsorbed slack, impact Chinese new venture performance. And it also examines the moderating effects of environmental characteristics, such as munificence and dynamism, on the slack‐performance linkage in Chinese transitional context.Design/methodology/approachA literature review on organizational slack and institutional environment characteristics provides the model and hypothesis. Using a sample of 91 Chinese new ventures, the authors conduct the examination on the theoretical model and hypotheses.FindingsThe results show that the relationship between absorbed slack and new venture performance is negative and unabsorbed slack has an inverse U‐shaped effect on new venture performance. Furthermore, the institutional environments, such as munificence and dynamism in transitional economies have different moderating effects on the relationship between organizational slack and new venture performance.Research limitations/implicationsThis study focuses on the new ventures of China, which is context specific. It is necessary to replicate this research in other transitional economies because of some specific differences between China and other transitional economies.Practical implicationsThe results of the study suggest that new ventures should strengthen the management of resources and decrease absorbed slack in order to reduce the managerial cost, and then raise the level of resource utilization. In addition, how the new ventures make better utilization of organizational slack to deal with institutional environment uncertainty would be a core task in future business operations.Originality/valueThe paper is original in its investigation of the effect of organizational slack on new venture performance in contingent transitional environments. The paper explains the relationship between different types of organizational slack and new venture performance from a contingent perspective, thus extending the extant research.

The State, Courts, and Equal Opportunities for Female CEOs in U.S. Organizations: Specifying Institutional Mechanisms

While institutional analyses have convincingly demonstrated the association between institutional environments and the rise of due-process structures in the workplace, they have been less clear on the extent to which institutional environments and due-process structures actually matter for worker outcomes in organizations. Through an analysis of CEOs in a national sample of U.S. organizations, this article contributes to institutional research in two ways: First, we examine the actual implications of institutional environments and due-process structures for equality of opportunity for women in the workplace, focusing on the likelihood that an organization will have a female CEO. Second, whereas institutional analyses have often relied on the presence of time-period effects to draw inferences about unmeasured characteristics of institutional environments, we measure characteristics of the institutional environment directly at the state and federal levels. Results show that specific aspects of the institutional environment in which an organization is situated, as well as the structure of an organization's internal labor market, are significant predictors of whether an