Which Types of Political Capital Matter for Internationalizing Firm and Where Do They Matter? Evidence from Russia FDI and Exports

40 Pages Posted: 18 Jul 2017

See all articles by Rajeev J. Sawant

Rajeev J. Sawant

Florida Atlantic University - Department of Management

Lilac Nachum

City University of New York - Allen G. Aaronson Department of Marketing & International Business

Andrei Panibratov

Saint Petersburg State University - Graduate School of Management

Date Written: January 1, 2017

Abstract

We distinguish between two types of political capital and hypothesize that their value for firms varies at home and overseas. Hence they support different modes of international activity. Empirical testing of Russian firms shows that relational political capital is of high value in the home country and therefore encourages exports and diminish FDI. Knowledge political capital creates a firm-specific capability that can be exploited overseas, thus facilitating FDI and reducing exports. The relationships are contingent upon ownership and industry affiliation. These findings call for a nuanced conceptualization of political capital as a multi-dimensional construct whose impact varies across geographies.

Suggested Citation

Sawant, Rajeev J. and Nachum, Lilac and Panibratov, Andrei, Which Types of Political Capital Matter for Internationalizing Firm and Where Do They Matter? Evidence from Russia FDI and Exports (January 1, 2017). Available at SSRN: https://ssrn.com/abstract=3001554 or http://dx.doi.org/10.2139/ssrn.3001554

Rajeev J. Sawant

Florida Atlantic University - Department of Management ( email )

777 Glades Road
Boca Raton, FL 33433
United States

Lilac Nachum (Contact Author)

City University of New York - Allen G. Aaronson Department of Marketing & International Business ( email )

One Bernard Baruch Way, B12-240
New York, NY 10010-5585
United States

Andrei Panibratov

Saint Petersburg State University - Graduate School of Management ( email )

Volkhovsky Per. 3
St. Petersburg, 199004
Russia

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