Essays on global strategy and institutions

Abstract

This thesis examines how firms in countries with weak governance institutions access outside (technological and financial) resources and capabilities. The first essay challenges current views regarding the efficacy of renting foreign jurisdictions through cross-listings and shows that reputational mechanisms are more important. The second essay, which follows a group of Korean firms through the sequence of liberalizations and political changes since 1987, provides further evidence that reputational mechanisms are central in obtaining external resources and capabilities. The third essay suggests that Mexican firms selected alternative strategies besides cross-listings before liberalization, and that one of these strategies (forming a cross-border alliance) turned out to be more effective. The timing of liberalization is the key shift variable that determines which Mexican firms cross-listed and which firms instead formed cross-border alliances and/or acquired political connectedness. This thesis also demonstrates the complementarity of investing in domestic influence and the establishment of cross-border strategic alliances.