OverPowering Influence of Institutional Distance on Chinese Firms’ Cross-border M&A Performance

다국어 초록 (Multilingual Abstract)

The performance of Chinese firms’ cross-border M&As is analyzed with an institutional perspective. Two core variables of institutional view: institutional distance and state ownership are examined in this study related to M&A performance of Chinese firms. 198 cross-border M&As undertaken by Chinese firms between 2000 and 2010 were examined in this study. The results indicate that institutional distance has a negative impact on Chinese firms’ cross-border M&A performance. While state ownership has a positive impact on Chinese firms’ cross-border M&A performance, its impact became negative when moderated by institutional distance. In addition, the same effect has been shown with the international experience of the firm: a positive relationship of international experience on performance turned negative when moderated by institutional distance. In sum, the institutional perspective may explain the poor performance of Chinese firms’ cross-border acquisitions. Further discussion in addressed at the end of the paper.