Feeling the squeeze: EMNEs’ international expansion as a driver of nonmarket political strategy at home
ISSN: 0955-534X
Article publication date: 18 September 2023
Issue publication date: 23 January 2024
Abstract
Purpose
The purpose of this study is to investigate the effect of international expansion of emerging markets multinationals (EMNEs) on the home country nonmarket political strategy and why some EMNEs intensify this political tie more than others.
Design/methodology/approach
We test our theoretical framework using longitudinal data, with 16 years of observations, in Multilatinas and state loans from Brazil, one of the main outward foreign direct investment (OFDI) players in the world and the OFDI leader in Latin America.
Findings
Theoretically grounded on the institution-based view of strategy, it can be postulated that international expansion is a driver of home country nonmarket political strategy. It can also be hypothesized that political tie intensity is affected by the capacity of EMNEs to deal with international expansion issues without having to depend on relationship with homes country nonmarket political actors. The results provide support for the hypotheses presented.
Originality/value
This paper contributes to the EMNE internationalization literature by extending the understanding of the underlying motivations and forces shaping the home country nonmarket political strategy of multinationals from emerging markets and, thus, helping understand why some EMNEs tend to be more politically active than others. Likewise, the study contributes to advancing understanding regarding the home country strategic responses adopted by Multilatinas and the forces behind the nonmarket political strategies they employ in their international expansions, especially during turbulent times.
Keywords
Acknowledgements
The authors would like to thank the editor and anonymous reviewers for their helpful comments and guidance in the review process.
Funding: This study was financed in part by the Coordenação de Aperfeiçoamento de Pessoal de Nível Superior – Brasil (CAPES) – Finance Code 001.
Citation
da Silva, J.C., Marcon, R., Parente, R. and Gambirage, C. (2024), "Feeling the squeeze: EMNEs’ international expansion as a driver of nonmarket political strategy at home", European Business Review, Vol. 36 No. 1, pp. 89-111. https://doi.org/10.1108/EBR-01-2023-0030
Publisher
:Emerald Publishing Limited
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