Government Ties Research Articles

A Real Options Perspective on Entrepreneurial Orientation and Government Ties

Firms’ strategic orientation toward entrepreneurship exposes them to regulatory uncertainties. Prior research suggests that addressing these uncertainties through corporate political activities (CPA) may require costly trade-offs, such as the loss of strategic flexibility. We argue that some of these trade-offs can be mitigated by the way firms structure their CPA. We extend the insights from real options reasoning (ROR) to offer a framework for how firms may circumvent some of these trade-offs through greater CPA breadth, which allows firms to retain their strategic flexibility while reaping some of the benefits of CPA.

Government affiliation, analyst behavior and the economic consequences

AbstractA significant number of regional brokerage firms in China are owned by their respective local governments. We use this context to examine how local government affiliation affects brokerage firms’ research activities. Using a sample of analyst reports from 2013 to 2021, we find that analysts working at local government‐affiliated brokerage firms are more likely to cover firms within the local government's jurisdiction than non‐affiliated analysts. Local government‐affiliated analysts enjoy an information advantage, as evidenced by the issuance of more accurate earnings forecasts for local firms, compared to those of non‐affiliated analysts. The effect is stronger for local firms with lower information quality. Additionally, local government‐affiliated analysts show more optimism in stock recommendations, but not in earnings forecasts, for local firms, compared to non‐affiliated analysts. The effect is more pronounced for local firms that receive more local government subsidies, operate in regions with greater local government intervention or during the COVID‐19 pandemic and the National Congress conferences, and require more capital market support. The results of this study advance our understanding of the key determinants of analyst performance and provide new evidence in the debate on the role of government intervention in financial institutions.

A Little in a Lot: A Real Options Perspective on Entrepreneurial Orientation and Government Ties

A Little in a Lot: A Real Options Perspective on Entrepreneurial Orientation and Government Ties

Are sustainable firms more innovative? The case of China

Although the impact of corporate social responsibility (CSR) on business and market performance has been getting attention in China, its influence on innovation outcomes has not been fully investigated. This study utilises patent information and CSR measurements from Orbis and Refinitiv, respectively, and empirically investigates the determinants of corporate innovation, focusing specifically on the influence of CSR. We find a positive relationship between CSR and innovation outcomes, namely patent applications and patents granted, which are also found in developed countries. Furthermore, our findings provide new insights into inconclusive factors such as the impact of Chinese economic policies or government ties on innovation performance. In particular, we find that government-owned firms no longer have a relative advantage in innovation.

Government Affiliation, Analyst Behavior and the Economic Consequences

Government Affiliation, Analyst Behavior and the Economic Consequences

“Dracunculus against the dragon”: Hungarian Prime Minister Viktor Orbán’s public vaccination as simultaneous enactment of public health and foreign policy

ABSTRACT This article examines performativity in Hungarian Prime Minister Viktor Orbán’s February 2021 public vaccination against COVID-19 with the Sinopharm BBIBP-CorV vaccine. Following a discussion of the concept of performativity as it pertains to the subject of our study, we contextualize the process of the procurement of the Sinopharm BBIBP-CorV vaccine by Hungary to situate the significance of this transaction, along with that of the performance under review, in the post-2010 evolution of broader Sino-Hungarian government ties. We then submit footage of PM Orbán’s vaccination to multimodal critical discourse analysis, identifying several noteworthy features of this performance. We also examine similar performances by other heads of state and government, offering evidence that – having gone beyond the purposes of public health messaging to constitute a simultaneous enactment of foreign policy (and more) – PM Orbán deviated considerably from the consensus norms of public vaccination that have emerged in the reference group. This further indicates that his public vaccination with BBIBP-CorV was both a peculiar instance of vaccine diplomacy and a “demand-driven” manifestation of Chinese influence in Hungary.

"It all depends on why it's red": qualitative interviews exploring patient and professional views of a traffic light system for IVF add-ons.

Background IVF add-ons are techniques, medicines or procedures used in addition to standard IVF with the aim of improving the chance of success. The United Kingdom's IVF regulator, ( the Human Fertilisation Embryology Authority (HFEA) developed a traffic light system to categorise add-ons as either green, amber, or red, based on results of randomised controlled trials. Method Qualitative interviews were undertaken to explore understanding and views of the HFEA traffic light system among IVF clinicians, embryologists and IVF patients across Australia and the United Kingdom. Results A total of 73 interviews were conducted. Overall, participants were supportive of the intention of the traffic light system, however many limitations were raised. It was widely recognized that a simple traffic light system necessarily omits information which may be important to understanding the evidence base. In particular, the red category was used in scenarios that patients viewed as having different implications for their decision-making, including 'no evidence' and 'evidence of harm'. Patients were surprised at the absence of any green add-ons and questioned the value of a traffic light system in this context. Many participants considered the website a helpful starting point, but desired more detail, including the contributing studies, results specific to patient demographics (e.g., <35 years and >35 years), and inclusion of more options (e.g. acupuncture). Overall, participants believed the website to be reliable and trustworthy, particularly due to the Government affiliation, and despite some concerns regarding transparency and an overly cautious regulator. Conclusion Participants identified many limitations with the current application of the traffic light system. These could be considered in any future updates to the HFEA website and for others developing similar decision support tools.

Report on the Journal of Wildlife Management, 2022

Report on the <i>Journal of Wildlife Management</i>, 2022

The influence of government affiliations on firm product innovation in a dynamic institutional environment: insights from China

PurposeBuilding on resource dependence theory and the dynamic institution-based view, this paper examines the influence of government affiliations on firm product innovation in a dynamic institutional environment.Design/methodology/approachUsing unique panel data of Chinese manufacturing firms covering a period of 12 years (1998–2009) with 2,564,547 firm-year observations, this study chooses the panel Tobit model with random effects to explore the influence of government affiliations on firm product innovation, followed by an analysis to test the moderation effects of dynamic institutional environments.FindingsThe study findings suggest that Chinese firms with higher-level government affiliations have a relatively high product innovation performance. It finds that this innovation stimulating effect is contingent on the dynamic nature of the institutional environment. To be specific, a high speed of institutional transition may depress the positive innovation effects of government affiliations, while a more synchronized transition speed of institutional components may enhance the positive innovation effects of firms' government affiliations.Originality/valueThis study adds to a better understanding of the drivers of product innovation in Chinese firms that are situated in environments that are characterized by institutional change, using and contributing to resource dependence theory and the dynamic institution-based view.

Political ideology and international capital allocation

Does investors’ political ideology shape international capital allocation? We provide evidence from two settings—syndicated corporate loans and equity mutual funds—to show ideological alignment with foreign governments affects the cross-border capital allocation by U.S. institutional investors. Ideological alignment on both economic and social issues plays a role. Our empirical strategy ensures direct economic effects of foreign elections or government ties between countries are not driving the result. Ideological distance between countries also explains variation in bilateral investment. Combined, our findings imply ideological alignment is an important, omitted factor in models of international capital allocation.

Configurational framework of learning conduits used by emerging economy firms to improve their innovation performance

The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In response to this popular phenomenon, scholars are examining many learning conduits used by these firms to improve their innovation performance. The various learning conduits used by these firms include technology licensing, government R&D support, university-firm linkages, business groups, government affiliation, outward FDI, international collaborations, inward FDI, outsourcing, exporting, and importing. Building on a systematic review of 115 papers on this topic, we find this literature to be unstructured, with no organizing framework. To help researchers take stock and make advancements, we use configurational theorizing to develop a framework that helps understand when and why these emerging economy firms tend to use the different learning conduits. Specifically, we propose that the choice of learning conduits is often driven by two key factors: the relative level of institutional formality of the emerging economy and the relative level of traditional ownership advantages of these firms. Building on these two dimensions, we classify emerging economy firms into four configurations: social network focused firms, laggard firms, leader firms, and cutting-edge firms. We generate new insights based on our framework and overview of the existing studies, identify gaps in the literature, and make recommendations about how to extend this growing stream of research.

The First Counterspy: Larry Haas, Bell Aircraft, and the FBI’s Attempt to Capture a Soviet Mole by Kay Haas and Walter W. Pickut

<i>The First Counterspy: Larry Haas, Bell Aircraft, and the FBI’s Attempt to Capture a Soviet Mole</i> by Kay Haas and Walter W. Pickut

The 2022 Journal of Wildlife Management report and journal news

The 2022 <i>Journal of Wildlife Management</i> report and journal news

How Information Flows from the World to China

Government censorship—internet shutdowns, blockages, firewalls—impose significant barriers to the transnational flow of information despite the connective power of digital technologies. In this paper, we examine whether and how information flows across borders despite government censorship. We develop a semi-automated system that combines deep learning and human annotation to find co-occurring content across different social media platforms and languages. We use this system to detect co-occurring content between Twitter and Sina Weibo as Covid-19 spread globally, and we conduct in-depth investigations of co-occurring content to identify those that constitute an inflow of information from the global information ecosystem into China. We find that approximately one-fourth of content with relevance for China that gains widespread public attention on Twitter makes its way to Weibo. Unsurprisingly, Chinese state-controlled media and commercialized domestic media play a dominant role in facilitating these inflows of information. However, we find that Weibo users without traditional media or government affiliations are also an important mechanism for transmitting information into China. These results imply that while censorship combined with media control provide substantial leeway for the government to set the agenda, social media provides opportunities for non-institutional actors to influence the information environment. Methodologically, the system we develop offers a new approach for the quantitative analysis of cross-platform and cross-lingual communication.

The Belt and Road Initiative in Southeast Asia: A Mixed Methods Examination

ABSTRACT How did the Belt and Road Initiative (BRI) shape the volume and destination of Chinese greenfield foreign direct investments (GFDI)? This article examines Chinese GFDI in Indonesia, Malaysia, the Philippines, and Myanmar using quantitative and qualitative data. Results show first, that the BRI led to a surge of investments by firms with stronger government affiliation in sectors related to infrastructure and connectivity. In contrast, the BRI had limited effect on firms in consumption-related industries that are primarily small and privately owned. Second, the change in sectoral destination of Chinese GFDI after the BRI is explained by the strength of diplomatic bilateral relations, which generate government support for investments in specific industries, and by host market conditions, such as favourable regulatory environments and positive economy outlook.

Stay or exit: How do international nongovernmental organizations respond to institutional pressures under authoritarianism?

AbstractInternational nongovernmental organizations (INGOs) are increasingly important players in global politics and development. However, they are undergoing significant adaptations as governments worldwide have instituted restrictions to regulate their activities. What explains the various ways in which they respond to these institutional pressures? In our study of INGO responses to a new restrictive law in China, we identify four strategic responses with varying levels of compliance: legal registration, provisional strategy, localization, and exit. The institutional pressures—strategic responses link is influenced by INGOs' adaptive capacity, which is in turn shaped by an organization's issue sensitivity, value‐add, government ties, and reputational authority. The integrated framework we develop for INGO strategic responses can shed light on state‐INGO relations in other countries, many of which are subject to increasingly stringent regulations and a closing political environment.

Social ties and the political participation of firms

It is widely accepted that better-connected firms exercise more political influence. However, because both social ties and political influence are difficult to observe, it remains little understood how different types of ties affect different types of political action. We develop new theory that contrasts the effects of ties to other firms in the same industry (peer ties) with ties to elected officials and bureaucrats (government ties). We argue that peer ties are useful for facilitating collective action, which is most often used to seek influence over broad policy issues that affect many firms. In contrast, while government ties are more versatile, these should primarily also allow firms to pursue narrow, particularistic issues that benefit only one or a small number of firms. Using a new survey of foreign-owned firms operating in the Philippines, we demonstrate that peer ties play an important role in firms’ efforts to influence policy at the national level, where issues are more likely to affect large numbers of firms. Government ties are also valuable, though primarily at the local level, where issues are more likely to affect a smaller number of firms.

Nonprofit Online Responsiveness: An Exploratory Field Experiment in China

This article assesses sources of nonprofit responsiveness and identifies potential drivers for responsiveness, using an online field experiment involving philanthropic foundations in China ( N = 3,254). Baseline requests were sent out to the foundations through emails and vignettes were applied to treatment groups by inserting different identity claims or prompts into the contents of the emails. Experimental results showed that, compared with the control group, potential donors were more likely to receive responses, claims concerning government ties or media backgrounds resulted in fewer responses, and citing legal obligations could increase the odds of receiving satisfactory responses. Interpreting the results with reference to stakeholder salience theory, we argue that potential donors are the most salient stakeholders to foundations. Donor requests and legal obligations are the most effective forces driving foundations’ responsiveness in China.

Government Affiliation and Peer-To-Peer Lending Platforms in China

With thousands of co-existing and competing platforms, the Chinese peer-to-peer (P2P) lending market experienced both high growth and high failure rate. We hand collect unique data for these P2P platforms and investigate the differences in performances and survivals for platforms with and without affiliations with state-owned enterprises (SOEs). P2P platforms with SOE affiliations have higher trading volumes, attract more investors, and offer lower interest rates. These platforms also survive significantly better than those without the SOE affiliations, especially during market downturns. Using P2P platforms with fake SOE affiliations as identification, we show that the SOE affiliation itself (not related to the fundamentals) is an important signal for P2P market participants. These results can be helpful to investors and regulators, especially those from other emerging markets.

REGIONS AND INNOVATION: A NEW TALE OF THREE ECONOMIC REGIONS IN CHINA

Learning is a key component of firm upgrading in emerging economies, and China is no exception to this. Studies have identified, among others, two critical mechanisms that facilitate learning: (1) connections with supportive local governments that enhance access to resources or publicly funded knowledge and (2) connections to co-located foreign multinational enterprises (MNEs) that enhance access to advanced knowledge and capabilities. However, previous studies on the effects of these connections on learning and innovation have had contradictory results. In this study, we develop a model of firm innovation capabilities based on regional differences in firms’ dependence on government and MNEs. Using a sample of 715 indigenous firms from the three historically dominant economic regions in China, we find that the effects of government and MNE ties on local firms’ learning and innovation performance vary depending on the historically dominant dependency patterns in the region.