Political Capital as a Spatially-Bounded Asset Location-specificity, Mobility and Firms’ International Strategies
26 Pages Posted: 28 Oct 2018 Last revised: 28 Nov 2018
Date Written: October 4, 2018
We articulate the spatial dimension of political capital and the geographic scale of its impact on firms. We conceptualize political capital as a construct whose location-specificity and mobility over distance vary across different types, being of value for different internationalization strategies. Empirical testing of Russian firms shows that relationship-based political capital, whom firms know, loses value outside the home country, reducing international investment, whereas knowledge-based capital, what firms know, encourages international investment. The relationships are firm-specific and contingent upon firms’ industrial affiliation, their proprietary assets and country portfolios, turning the configuration of firms’ political capital into a potentially important competitive asset. Our theory offers a means to conceptualize the distinctive nature of political capital in the context of internationalizing firms.
Keywords: mobility, firms’ international strategies, whom you know and what you know, relational and knowledge political capital, Russian firms
JEL Classification: F21, F23, M16
Suggested Citation: Suggested Citation