Institutions In Emerging Economies Research Articles

The green transition in emerging economies: green bond issuance in Brazil and China

ABSTRACT Green bonds have emerged as an innovative financial instrument that may be used to mobilise incremental resources for long-term financing projects focused on building sustainable infrastructure. In this regard, this article advances research on green bond markets in emerging economies (EEs) by comparing the evolution of the certified green bonds markets in Brazil and China. For this purpose, a mixed analysis was applied. The qualitative analysis is based on a literature review to contextualise the main drivers and barriers to the evolution of the green bond market in light of national policies and features of the financial system in each country. For the quantitative analysis, the certified green bond markets are assessed in terms of the amounts issued as a percentage of the debt securities markets, considering the participation of each issuer type and the allocation of revenue across eligible sectors. Information on certified green bond amounts issued and on debt securities’ markets was obtained from the Climate Bonds Initiative and BIS databases. The results show that the evolution of the Chinese and Brazilian certified green bonds markets remains negligible, in terms of the whole debt securities market. Although green bonds may be considered an important market solution, they still do not provide sufficient resources necessary for a meaningful green transition, especially in EEs. However, findings also show that in China, compared to Brazil, features of the financial system combine with more consolidated green policies to act in favour of scaling up and distributing revenue to crucial sectors to green transition. Key policy insights Without well-coordinated national green policies and appropriated institutional arrangements, the growth of the debt securities market in emerging economies (EEs) will not boost the certified green bond market. In EEs, notably in Brazil and China, the central government’s influence on the policy coordination and the financial system is fundamental in achieving green goals. Greater participation of state-owned financial institutions in EEs could improve the access to finance more emergent solutions (e.g. low carbon transport, water infrastructure, etc.) beyond more mature ones (the usual solar and wind energy) to promote the green transition.

Inequality through MNE–emerging economy coevolution? A political actor view on Myanmar/Burma’s peacebuilding

PurposeThis study aims to understand how the coevolution of multinational enterprises (MNEs) and emerging economy institutions affects social and economic (in)equality in an ambiguous, emerging economy context from a political actor perspective.Design/methodology/approachQualitative in nature, the study builds on conversations with 20 political actors involved in the peacebuilding process in Myanmar/Burma. It analyzes their perceptions of interaction of MNEs and host economy institutions from a social constructionist viewpoint.FindingsThe study identifies four coevolution patterns which portray the evolving interaction between MNE activities and different elements of their host institutional environment as well as their consequences for social and economic (in)equality.Originality/valueThis study contributes to critical international business research on emerging economies by emphasizing the different and partly conflicting host institutions of various stakeholder groups involved in the coevolution of MNEs and host institutional environments. The more nuanced conceptualization of the complex institutional environment enables the analysis of inequality as a direct and indirect outcome of MNE–institution interaction. Thus, the study connects to the business and human rights discussion and provides insight into the consequences of MNEs’ adoption of social and environment standards.

Resource curse impacts on the co-evolution of emerging economy institutions and firm internationalization

We investigate natural resource “curse” impacts on co-evolutionary relationships between emerging economy institutions and firm internationalization. We discuss how these relationships challenge and extend IB institutional research using three predominant resource curse characteristics (boom and bust cycles with related public discourse and “Dutch Disease” with associated manufacturing sector investment crowd-out). These characteristics alter regulative, normative and cognitive institutional impacts on state- and privately-owned firm internationalization during an emerging economy’s resource curse. We develop propositions describing these processes using oil and gas, manufacturing and service sector examples in several emerging economies. We discuss our theoretical contributions to the resource curse and international business literatures and outline future research directions.

Emerging Market Institutional Co-Evolution, State-Owned Firm Globalization, and the Resource Curse

We explore the effects of the natural resource “curse” on co- evolutionary relationships between emerging economy institutions and the internationalization of their state-owned enterprises. We disc...

Going above and beyond: How intermediaries enhance change in emerging economy institutions to facilitate small to medium enterprise development

AbstractResearch summaryDespite knowledge about the importance of intermediaries in filling institutional voids, we do not understand how intermediaries facilitate institutional change. This research demonstrates how intermediaries use six rhetorical legitimation strategies—logos, ethos, pathos, autopoiesis, teleological, and anthropos appeals—to influence institutional change in Abia, Nigeria, that facilitate small‐to‐medium‐enterprise (SME) development in the region. While the first five rhetorical legitimation strategies are used in both developed and emerging economies, the sixth strategy—anthropos appeals, which reflect the communal character of many African cultures—seems to be unique in this context. Our findings contribute to the literature by extending our understanding of the role of rhetorical legitimation strategies in bringing about institutional change, use of rhetoric to communicate entrepreneurial opportunities, and significance of nonmarket strategies for SMEs.Managerial summarySMEs influence economic development in emerging economies but face many constraints. This research examines how intermediaries help reduce constraints SMEs in Nigeria encounter by facilitating institutional changes, through the use of six legitimation strategies (logos, pathos, ethos, autopoiesis, teleological, and anthropos). Also, this research explains how the institutional changes encourage the government to fill voids that generate beneficial outcomes to SMEs, emergent local intermediaries, the general public, and the government itself. Finally, this research finds that market actors in Nigeria use an Anthropos legitimation strategy when appealing to individuals in the local market to help with SME development. This strategy, which taps into the communal character of many African cultures and interestingly has some parallels with Confucianism philosophy, seems to be unique in emerging economies.

Institution building in retreat

PurposeThe purpose of this paper is to describe co-devolutionary processes of multinational enterprise (MNE)/emerging economy institutional relationships utilizing concepts from “old” institutional theory as well as the institutional aspects of socially constructed realities.Design/methodology/approachThe authors develop a set of propositions that explore the new concept of a co-devolutionary relationship between MNEs and emerging economy institutions. Guided by prior research, the paper investigates MNE/emerging economy institutional co-devolution at the macro-(MNE home and host countries), meso-(MNE industry/host country regulative and normative institutions) and micro-(MNE and host country institutional actors) levels.FindingsMNE/emerging economy institutional co-devolution occurs at the macro-level via negative public communications in the MNE’s home and host countries, at the meso-level via host country corruption and MNE adaptation, and at the micro-level via pressures for individual actors to cognitively “take for granted” emerging economy corruption, leading to MNE divestment and a reduction in new MNE investment.Research limitations/implicationsBy characterizing co-devolutionary processes within MNE/emerging economy institutional relationships, the research augments co-evolutionary theory. It also assists in developing more accurate specification and measurement methods for the organizational co-evolution construct by using institutional theory’s foundational processes to discuss MNE/emerging economy institutional co-devolution.Practical implicationsThe research suggests the use of enhanced regulation, bilateral investment treaties and MNE/local institution partnerships to stabilize MNE/emerging economy institutional relationships, leading to more robust progress in building emerging economy institutions.Originality/valueThe research posits that using the concepts of institutional theory as a foundation provides useful insights into the “stickiness” of institutional instability and corruption in emerging economies and into the resulting co-devolutionary MNE/emerging economy institutional relationships.