Evolution of firm-and country-specific advantages and disadvantages in the process of Chinese firm internationalization

Marinova, Svetla and Child, John and Marinov, Marin (2011) Evolution of firm-and country-specific advantages and disadvantages in the process of Chinese firm internationalization. In: Dynamics of Globalization: Location-Specific Advantages or Liabilities of Foreignness? Advances in International Management, 24 . Emerald Group Publishing Limited, Bingley, United Kingdom, pp. 235-269. ISBN 978-0-85724-991-3

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Abstract

This chapter provides a logical extension to the understanding of firm-specific advantages and disadvantages and the enabling role of existing and emerging country- specific advantages relevant to the process of Chinese firm internationalization. Its longitudinal perspective considers the changing objectives and actions of firms that enable them to compensate for disadvantages and create new or strengthen existing competitive advantages. Decisively encouraged by the Chinese government firms with corporate entrepreneurship aspire to alter themselves from home market leaders and regional players into globally competing multi-nationals. This process is made possible via the development of firm-specific advantages and continuous compensation for firm-specific disadvantages. The aspiration for strategic asset acquisition from developed countries combined with cost leadership and independent customer-centred innovation brought about strong firm-specific advantages stimulating the internationalization process of firms. The chapter focuses on the interdependence of country- and firm-specific advantages and disadvantages, thus recognizing the significance of the home country institutional context in Chinese outward foreign direct investment. It has been identified that corporate entrepreneurship is a significant firm-specific advantage for firm internationalization being a major force in gaining, accumulating, utilizing and leveraging resources for transforming firm-specific disadvantages into advantages. We argue that if the relational framework between governmental institutions and firms is more developed, the impact of country-specific advantages on firm-specific advantages is more favourable. This assumes that the government espouses an ideology that is favourable to corporate entrepreneurship.

Item Type: Book Section
Uncontrolled Keywords: China, Government sponsored globalisation, Internationalisation, International markets
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HF Commerce
Divisions: Schools and Research Institutes > Business School > Business and Human Resource Management
Depositing User: Susan Turner
Date Deposited: 08 Dec 2014 16:14
Last Modified: 22 Jul 2015 14:10
URI: http://eprints.glos.ac.uk/id/eprint/1066

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