How MNES Navigate the Institutional Landscape in Emerging Markets and Developing Economies

Summary

Understanding how formal and informal institutions collectively establish the institutional landscape of emerging markets and developing economies (EMDEs) is important given the growing significance of EMDEs for multinationals (MNEs) seeking growth, lower operating costs and new markets. This impacts MNE performance, strategy, as well as entry and exit choices. In response to a recent Special Issue of the Journal of International Business Studies, which included calls for a more nuanced approach to the study of how formal and informal institutions interact to establish the institutional configuration in EMDEs, this thesis takes a mixed-methods approach as it draws on empirical studies as well as case study evidence. Overall, the findings presented highlight the need for MNEs to recognise that EMDE institutions – particularly those at the earlier stages of institutional reform are distinctively different from developed country institutional environments and as such, require distinct capabilities not required in Western-style institutional environments.