Dear friends and colleagues,
You can find the last 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:
And course, If you are interested in what is forthcoming at GSJ, please check it here
As always, we look forward to receiving your best work for consideration for publication.
Gabriel R. G. Benito, Alvaro Cuervo-Cazurra, and Ram Mudambi
Co-editors of Global Strategy Journal
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.
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.
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.
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.
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.
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.
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.
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.
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.
Innovating for the Middle of the Pyramid in Emerging Countries. Cambridge University Press