Dear friends and colleagues,

You can find the fourth issue of Global Strategy Journal in 2021 at It is a special issue on Institutions and Entrepreneurship analyzing the bridges between the fields of global strategy and entrepreneurship. The introduction and eight articles provide the latest thinking on the role of the context on entrepreneurial strategies. We hope that you find them insightful!

We have an open call for papers for a special issue on Ownership and Global Strategy with a deadline of June 15, 2022. More details are available here:

If you are interested in what is forthcoming at GSJ, please check

As always, we look forward to receiving your best work for consideration for publication.

Best wishes,

Gabriel R. G. Benito, Alvaro Cuervo-Cazurra, and Ram Mudambi
Co-editors of Global Strategy Journal

Institutions and entrepreneurship in a non©\ergodic world <>
Dan Li, Michael A. Hitt, Bat Batjargal, R. Duane Ireland, Toyah L. Miller, Alvaro Cuervo-Cazurra
This special issue advances the global strategy and entrepreneurship fields by providing a better understanding of the linkage between institutions and entrepreneurship. We provide an overview of existing literature in three key research areas: (a) the impact of institutions (types and complexity) on entrepreneurship, (b) the effect of institutional evolution (overall evolution and interplay among institutions) on entrepreneurship, and (c) the coevolution of institutions and entrepreneurship. We introduce the eight articles appearing in this special issue, examine the relationship between institutions and entrepreneurship in a non-ergodic world, and highlight meaningful and promising avenues for future research in each of the three key research areas in the domain of institutions and entrepreneurship.
Location capabilities, institutional distance, and start©\up survival <>
Carla V. Bustamante, Sharon F. Matusik, Jose Miguel Benavente
Location considerations play a key role in shaping venture performance. Using data from the largest accelerator in the world, we examine the effects of institutional distance and location capabilities on international start-ups' survival rates. We find that international start-ups' survival is shaped by whether it internationalizes to a country with stronger or weaker institutions than those in its home country. Further, the interaction between the directionality of institutional distance and location capabilities is important such that ventures that develop location capabilities in contexts of positive institutional distance experience greater survival rates. Through this study, we make an important theoretical contribution at the intersection of institutional and resource based theory by developing more granular knowledge about institutional dynamics across home and host countries.
A multiple agency view of venture capital investment duration: The roles of institutions, foreignness, and alliances <>
Shyamala Sethuram, Markus Taussig, Ajai Gaur
Venture capital firms (VCs) must simultaneously manage a range of relationships with investors, investees, prospective buyers, and co-investors who frequently exert divergent influences on when investments should be exited. The greater weight of one particular relationship can lead a VC to exit an investment earlier than would maximize returns for that investment. In this study, we utilize a global sample to examine how VC firms' investment duration decisions are shaped by firm-specific and environmental factors. Our findings suggest that VCs are less patient and exit faster when they have less experience, invest in more institutionally challenged host countries, or are foreign and invested in an emerging economy. Importantly, while co-investing with other VCs increases patience in advanced economies, this effect disappears in emerging economies.
Founder and professional CEOs' performance differences across institutions: A meta©\analytic study <>
Aten Zaandam, Dinesh Hasija, Alan E. Ellstrand, Michael E. Cummings
We examine the effect of institutions on performance differences between founder and professional CEOs. We do so by integrating an institutional perspective with findings from the literatures on CEOs' managerial discretion and cognition. Specifically, we theorize that in informal institutional environments characterized by high power distance and individualism and in formal institutional contexts characterized by low regulatory and political quality, differences in cognitive styles lead founders to enjoy performance advantages over professional CEOs. The results of our meta-analysis of 117 studies across 22 countries conducted between 1987 and 2020 support our predictions. We conclude by discussing the implications for research and policy regarding institutional development and the governance of entrepreneurial firms.
The impact of institutions on the entrepreneurial orientation©\performance relationship <>
William Wales, Galina Shirokova, Tatiana Beliaeva, Evelyn Micelotta, Louis Marino
In this study, we theorize how regulatory, normative, and cognitive institutions moderate the entrepreneurial orientation (EO)-performance relationship. We test our hypotheses using data from entrepreneurial ventures in 31 countries. In countries with well-developed legal and financial institutions and where entrepreneurship is normatively supported, entrepreneurs achieve higher returns from an entrepreneurial strategic posture. Institutions positively moderate this relationship through increased resource access, a critical element for innovative entrepreneurial strategies. The effect of institutions is further moderated by the stage of economic development. We advance our understanding of EO by exploring country-level institutional boundary conditions to its value and extend institutional theory through evidence of its moderating effects and interactions with economic development.
Chief executive officer power and initial public offering underpricing: Examining the influence of demand©\side cultural power distance <>
Ryan Krause, Juanyi Chen, Garry D. Bruton, Igor Filatotchev
Initial public offering (IPO) underpricing reflects the inability of early investors to capture the full value of an entrepreneurial firm. IPO firms can potentially limit underpricing by signaling wealth protection through lower chief executive officer (CEO) power. Such signaling is particularly challenging for many IPO firms, though, because for those doing business in high-power-distance cultures, CEO power can also signal wealth creation, making CEO power a mixed signal for IPO investors. Drawing on signaling theory, we argue that CEO power is positively associated with IPO underpricing, but this relationship weakens for IPO firms doing business in countries with high cultural power distance because the information signaled becomes less clear. The signaling impact of both CEO power and demand-side cultural power distance weakens, however, when underwriter reputation offers a substitute signal.
The consequences of short©\term institutional change in the rule of law for entrepreneurship (open access) <>
Tomasz Mickiewicz, Ute Stephan, Muntasir Shami
Past research views institutions as stable and slow to change and uses institutional differences to explain cross-national variation in entrepreneurship. This article introduces a new perspective to institutional theory, that of short-term institutional change. Integrating insights from cognitive science allows us to theorize not just about the significance of short-term institutional change but also about why and how deterioration versus improvements in institutions have distinct effects. We test how short-term institutional change impacts entrepreneurship in a cross-country multilevel study. We find that short-term change in the rule of law affects entrepreneurial entry and that institutional deterioration weighs heavier than institutional improvement. We argue and find that changes in the rule of law are more consequential for entrepreneurship compared to changes in business regulations.
The moderating role of polycentric institutions in the relationship between effectuation/causation logics and corporate entrepreneur's decision©\making processes <>
Ivan Garrido, S¨ªlvio Vasconcellos, Kad¨ªgia Faccin, Jefferson Marlon Monticelli, Caroline Carpenedo
This study analyzes how firms respond to institutional polycentrism, a governance system that emerges from multiple and independent centers of power that interact to determine and regulate an evolutionary overarching comprehensive social system of rules. We propose that institutional polycentrism moderates corporate entrepreneurs' decision-making processes. We conducted a case study at a multinational corporation over four decades of internationalization using process data analysis. We found that institutional polycentrism determines a calibration between causation and effectuation logics. The study offers two contributions: (a) expanding the explanatory power of institutional polycentrism by understanding how it moderates the corporate entrepreneur's decision-making process in polycentric institutional contexts and (2) proposing a relatively novel contingency dimension of the effectuation versus causation and establishing new boundary conditions of the effectuation versus causation.
Time to change lanes: How pro©\market reforms affect informal ventures' formalization speed <>
David H. Weng, Seung-Hyun Lee, Yasuhiro Yamakawa
We argue that pro-market reforms encourage informal ventures to obtain formal registration quickly by altering the relative costs and benefits of joining the formal sector. We furthermore contend that this reform effect is shaped by several contextual factors such that venture embeddedness and market position increase the costs of leaving the informal sector, weakening the effect of pro-market reforms. Although foreign competition may make the formal sector more competitive and dampen the effect of pro-market reforms, larger informal economy may induce informal ventures to stay put. Results based on a sample of multicountry ventures support our arguments, suggesting that pro-market reforms can speed up informal ventures' formalization processes.


  Professor, International Business and Strategy, Northeastern University

   Co-editor, Global Strategy Journal<>

Recent publications:

   Enriching internationalization process theory: insights from the study of emerging market multinationals<>. JIM

   Multinationals misbehavior<>. JWB

   Implementing the United Nations¡¯ Sustainable Development Goals in international business<>. JIBS

   State ownership and internationalization: The advantage and disadvantage of stateness<>. JWB

   Innovating for the Middle of the Pyramid in Emerging Countries<>. Cambridge University Press

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