| In the era of de-globalization,Sino-US competition and geopolitical conflicts,Chinese multinationals are facing unprecedented challenges overseas.On the one hand,deglobalization seems to be a reality.New types of protectionism,populism and technonationalism are also emerging one after another.It is undoubted that the global value chains are being restructured and decoupled at an accelerated pace,and the global economic system is undergoing major restructuring.On the other hand,with the escalation of competition between China and the United States,the conflict between Russia and Ukraine,and other geopolitical conflicts,multinationals are deeply influenced by political factors.Theoretically,research on the internationalization of emerging market multinational enterprises(EMNEs)represented by Chinese multinational enterprises focuses on the radical and rapid expansion process through cross-border mergers and acquisitions.Although existing studies have realized the high failure rate of cross-border mergers and acquisitions,few studies have confronted the divestment behavior behind their rapid expansion.Therefore,this study focuses on the important question of "How do inter-state relations affect the Chinese multinationals’ foreign divestment behavior?" Based on international relations theory,institutional theory and political risk perspective,this study discusses three key research questions:(1)How do bilateral relations between countries affect Chinese multinationals’ foreign divestment behaviors?(2)How does the third-country conflict with home country affect Chinese multinationals’ foreign divestment behaviors?(3)What are the antecedent configurations of Chinese multinationals’ foreign divestment behaviors?In other words,what are the equivalent paths leading to foreign divestment of multinationals?The answers to the above key research questions are conducive to the deep understanding of EMNEs’ foreign divestment behaviors,and help multinational corporations to figure out the whole process of internationalization.Based on these research questions,the contents and conclusions of this research are as follows:First,study 1 reveals the mechanism of the bilateral political relations and interstate military conflicts on EMNEs’ foreign divestment.Based on the data of overseas subsidiaries of listed Chinese manufacturing companies and Cox proportional hazards model,Study 1 empirically tests the impact of bilateral political relationship distance and bilateral military conflicts on EMNEs’ foreign divestment.The study finds that bilateral political relationship between the home country and the host country and the bilateral military conflict will both increase the likelihood of EMNEs’ foreign divestment behavior.The "unfriendly"political relations and military conflicts between the two countries will increase the legitimacy pressure and political risks faced by multinational corporations in the host country,which in turn significantly affect the survival of multinational corporations in the host country.When multinational corporations cannot handle these pressures and risks,they will withdraw from the host country.This study also further identifies the boundary conditions.State-owned enterprises and politically sensitive industries are more likely to increase the likelihood of divestment in the host country when the bilateral political relationship is unfriendly;however,bilateral trade between home country and the host country weaken the above relationship.Second,study 2 extends the relationship between countries from "dyadic" to"multilateral" relationship,and further explores the mechanism of third-country conflict on EMNEs’ foreign divestment.The conflict between the home country and the third country may spill over to other countries including the host country,a phenomenon called "spatial spillover effect of the conflict".Based on this,the political risk and legitimacy pressure formed by the third country will also affect the divestment behavior of multinational enterprises in the host country.This relationship is stronger in host countries that have good political relations with third countries.This study also finds that informal institutional arrangements and bilateral trade between the home country and the host country will weaken the above effects by strengthening the communication and trust between peoples and increasing the opportunity cost of the conflict,respectively.Finally,Study 3 integrates interstate political relationship into the traditional theoretical model of foreign divestment and proposes an-OLIP farmwork that affects EMNEs’ foreign divestment.Using fuzzy-set qualitative comparative analysis(fsQCA),this study explores the impact of five antecedent conditions on the foreign divestment of multinational enterprises-the intangible assets of the parent company,the institutional quality and labor costs of host country,the entry mode of foreign subsidiaries,and the political relationship between the two countries.This study identifies two configurations that lead to EMNEs’ foreign divestment:the exit mode dominated by economic efficiency,that is host country labor costs with cross-border mergers and acquisition,the exit mode dominated by political relations between countries with entry mode by greenfield.The former takes the host country labor cost and M&A as the core conditions,while the later takes the bilateral political relationship and the entry mode of greenfield as the core conditions.Combined with the typical cases of each path,this paper gives a theoretical explanation of the relevant configurations.The theoretical contributions of this paper are as follows:First,this study constructs the theoretical framework of how inter-state relations affect Chinese multinationals’ foreign divestment behavior,and reveals mechanism of multi-dimensional,complex and dynamic interstate relationship between countries on EMNEs’ foreign divestment behavior.Most of the previous studies on foreign divestment explored the antecedents of multinational enterprises’ divestment from the economic side,but they ignored the influence of non-economic factors.Based on the international relations theory,institutional theory and political risk perspective,this paper constructs a theoretical model of bilateral political relations and conflicts between countries on EMNEs’ foreign divestment behavior.Based on the data of Chinese manufacturing listed companies,this study reveals that inter-state political relations and military conflicts will increase the political risk of transnational enterprises and reduce their legitimacy in the host country,thus leading to the exit of subsidiaries.In addition,this paper further explores the choice of foreign divestment mode in the case of bilateral conflicts,which enriches and expands the relevant research on foreign divestment.Second,this paper further explores the influence mechanism of "third-country conflicts" on EMNEs’foreign divestment,and expands the research of the effect of inter-state relations on enterprises’ strategic decision-making.Although in the field of international business research,a small number of scholars have examined the impact of bilateral relations between countries on M&A and alliances,the extant research has not paid attention to the impact of conflicts in third countries on corporate strategic decision-making.Based on the literature of international relations,this study extends the research of the impact of inter-state relations on enterprise from bilateral relations to "trilateral",and figure out the spillover effect of legitimacy and political risk generated by conflicts between home and third countries,and empirically tests the mechanism of third-country conflicts on EMNEs’ foreign divestment.It further enriches the research on the influence of inter-state relations on the strategic decisionmaking of micro enterprises in the field of international business.Third,by integrating inter-state political relationship into traditional IB model,this study puts forward the-OLIP framework of foreign divestment and expands the theory of foreign divestment.It also provides a new theoretical tool to explain EMNEs’ foreign divestment.Research on foreign divestment always borrowed theories from other subjects.In 1983,Boddywn first proposed foreign divestment theory.However,it limited to the conceptual framing and was lack of empirical testing.Based on the framework and fuzzy-set qualitative comparative analysis,two paths of foreign divestment of multinational enterprises are identified,which provides new theoretical insights and practical implications for explaining the path of foreign divestment of multinational enterprises. |
