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Institution, strategy, and performance: A co-evolution model in transitional China

Author

Listed:
  • Shisong Jiang
  • Limin Gong
  • Hua Wang
  • Chris Kimble

    (Euromed Marseille - École de management - Association Euromed Management - Marseille, MRM - Montpellier Research in Management - UPVM - Université Paul-Valéry - Montpellier 3 - UPVD - Université de Perpignan Via Domitia - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School - UM - Université de Montpellier)

Abstract

Over the last two decades, Chinese firms have grown quickly even in a complicated and conflicting institutional environment. Prior explanations focus on either government support at the institutional level, or imitation strategy at the firm level. We argue that these accounts are empirically inconclusive and theoretically insufficient in that they are unidirectional and contain a single perspective at a single level. Through a longitudinal case study of Geely Group, a leading private carmaker in China, we develop a co-evolution model of institutional environment, strategic ambidexterity, and innovation performance with a progression of positive feedback. We also propose a new managerial intentionality mechanism based on the positive feedback of innovation performance. Besides, we find that the role of government on firm growth is more complicated and dynamic than has been assumed. Overall, our co-evolution framework provides a more powerful and specific account of why transition economy firms have grown so fast.

Suggested Citation

  • Shisong Jiang & Limin Gong & Hua Wang & Chris Kimble, 2016. "Institution, strategy, and performance: A co-evolution model in transitional China," Post-Print halshs-01291558, HAL.
    • Handle: RePEc:hal:journl:halshs-01291558
    DOI: 10.1016/j.jbusres.2016.02.009
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    References listed on IDEAS

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