CEO Cross-Sector Work Experience and Public–Private Partnership Formation of Private Firms in China

As the need for collaboration across multiple organizations to deal with complex social issues such as poverty, crime, and public health grows, Public–Private Partnership (PPP) is of increasing importance. However, little is known about when and why private firms engage in such partnerships. Drawing on upper-echelon theory and the information-processing perspective, we highlight the importance of institutional knowledge and information embedded in CEO cross-sector work experience. We argue that such tacit knowledge and information enables CEOs to better identify the potential risks associated with PPPs. Consequently, CEOs with cross-sector work experience tend to be more cautious in participating in such partnerships, especially in developing economies like China, where private actors face greater information incompleteness concerning post-collaboration hazards due to the government's selective disclosure. Moreover, we develop a multi-moderator framework in which regional marketization and political connection alter the main effect by serving as supplementary information channels for private actors. A panel dataset of Chinese private listed firms from 2013 to 2021 provides strong support for our hypotheses. This study contributes to our understanding of the micro-foundation of PPP formation and draws attention to CEOs’ prior career experiences in different organizational forms.