Home Country Institutions and Post-acquisition Performance
Title: Home Country Institutions and Post-acquisition Performance
Lecturer: Dr. Hong ZHU, Assisstant Professor, Dept. of Management, Chinese University of Hong Kong
Time: 14:00pm, Sept. 18th (Wed.), 2013
Place: Room 105, North Building
How do home country institutions influence international post-acquisition performance? Building on the institution-based view of strategy, we argue that two major informal institutions—collectivism and humane orientation in home countries—facilitate post-acquisition integration and value creation. In contrast, purposefully created formal institutions—shareholder rights protection and property rights protection—constrain the collaborative efforts toward effective post-acquisition integration and value creation. Moreover, as acquiring firms are simultaneously embedded in their home countries’ informal and formal institutions, we hypothesize that the positive effects of collectivism and humane orientation can be constrained by incompatible formal institutions that encourage individual rather than collaborative efforts. We find strong support for our hypotheses in a multilevel analysis of a sample of 12,021 international acquisitions involving 50 countries between 1995 and 2003.