The Effects of Institutional Environments on Firms' Market Orientation


Student thesis: Doctoral Thesis

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Award date14 Jan 2019


This dissertation discusses the implementation of marketing orientation in the context of a deregulation industry in transitional economies. When pro-market institutional reforms curtail the old state socialism logic and introduce the new market capitalism logic into the economy, how do organizations adapt and survive under uncertain institutional environments? Specifically, the study examines (1) how institutional uncertainty drives the implementation of market orientation, and (2) how market orientation affects firms’ performance in a deregulated industry context. The main purpose of this study is to offer a better understanding of how perceived institutional uncertainty influences market orientation and whether market orientation could serve as an adaptive strategic orientation in navigating deregulation. Combining the institutional analysis and organizational identity perspective, it investigates the institutional antecedents and contingencies of market orientation.

Results from 228 firms from the Chinese engineering and consulting industry reveal that (1) institutional volatility and ambiguity have different effects on market orientation, (2) market orientation has a positive effect on firm performance in the deregulation context, and (3) organizational identity characteristics (i.e., organizational identity, market scope) moderate the link between market orientation and firm performance. The current findings suggest that institutional factors should be considered in the formation and implementation of market orientation in a deregulation context. Implications of these findings for future research, both on market orientation and deregulated industries, are discussed.

    Research areas

  • market orientation, firm performance, institutional uncertainty, organizational identity, market scope