Home Country Institutions Behind Cross-Border Acquisition Performance

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journal

12 Scopus Citations
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Author(s)

  • Hong(Susan) Zhu
  • Xufei Ma
  • Steve Sauerwald
  • Mike W. Peng

Detail(s)

Original languageEnglish
Pages (from-to)1315-1342
Journal / PublicationJournal of Management
Volume45
Issue number4
Online published22 Mar 2017
Publication statusPublished - Apr 2019
Externally publishedYes

Abstract

How do home country institutions influence cross-border postacquisition performance? We develop an institutional framework showing that informal and formal institutions not only have important individual effects but also work together in complex and interesting ways. While collectivism and humane orientation (two major informal institutions) can facilitate postacquisition integration and firm performance, shareholder orientation and property rights protection (two formal institutions) constrain postacquisition integration and firm performance. As acquirers are simultaneously embedded in their home countries’ informal and formal institutions, we further hypothesize that the positive effects of collectivism and humane orientation can be weakened by incompatible formal institutions that hamper postacquisition collaborative efforts. We find strong support for our hypotheses in a multilevel analysis of a sample of 12,021 cross-border acquisitions involving 43 home and target countries between 1995 and 2003.

Research Area(s)

  • home country institutions, informal institutions, formal institutions, institution-based view, cross-border acquisitions, multilevel analysis

Citation Format(s)

Home Country Institutions Behind Cross-Border Acquisition Performance. / Zhu, Hong(Susan); Ma, Xufei; Sauerwald, Steve; Peng, Mike W.

In: Journal of Management, Vol. 45, No. 4, 04.2019, p. 1315-1342.

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journal