Pro-Market Institutions and Global Strategy: The Pendulum of Pro-Market Reforms and Reversals

Forthcoming, Journal of International Business Studies

39 Pages Posted: 20 Jan 2019

See all articles by Alvaro Cuervo-Cazurra

Alvaro Cuervo-Cazurra

Northeastern University - Department of International Business and Strategy

Ajai Gaur

Rutgers Business School - Newark and New Brunswick

Deeksha A. Singh

Rutgers Business School - Camden; National University of Singapore (NUS)

Date Written: January 10, 2019

Abstract

We review the literature analyzing the impact of pro-market institutions on firms’ global strategy. We propose that the ideological tension between whether the government or the market should drive economic development results in a pendulum of pro-market reforms and reversals that drive changes in firm strategy and performance. Much progress has been made in the analyses of pro-market reforms and their impact on firms’ international strategies and performance. However, there is a need to further learn about four areas: (1) the concept of pro-market institutions, in particular the variety of institutional dimensions, the measures, and the influence of informal institutions on firm strategies; (2) the drivers of changes in pro-market institutions, especially firms’ influences and the co-evolution of firm strategies and institutional changes; (3) the implications of changes in pro-market reforms for the interactions among integration, diversification, and internationalization strategies, the causality chains connecting institutions and strategies, and the reconfiguration of activities globally; and (4) the non-traditional moderators that alter the impact of pro-market institutional dynamics on firms’ strategies, such as country-level political systems, industry-level competitor reactions, and individual-level managerial capabilities and perceptions.

Suggested Citation

Cuervo-Cazurra, Alvaro and Gaur, Ajai S. and Singh, Deeksha A., Pro-Market Institutions and Global Strategy: The Pendulum of Pro-Market Reforms and Reversals (January 10, 2019). Forthcoming, Journal of International Business Studies. Available at SSRN: https://ssrn.com/abstract=3314068

Alvaro Cuervo-Cazurra

Northeastern University - Department of International Business and Strategy ( email )

D'Amore-McKim School of Business
313 Hayden Hall, 360 Huntington Avenue
Boston, MA 02115
United States
16173736568 (Phone)
16173738628 (Fax)

HOME PAGE: http://cuervo-cazurra.com

Ajai S. Gaur (Contact Author)

Rutgers Business School - Newark and New Brunswick ( email )

Newark, NJ
United States

Deeksha A. Singh

Rutgers Business School - Camden ( email )

227 Penn Street
Camden, NJ 08102
United States

National University of Singapore (NUS) ( email )

Bukit Timah Road 469 G
Singapore, 117591
Singapore

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