A Meta-analysis Of The Relationship Between Institutional Distance And Enterprises’ Oversea Market Investment Mode

The choice of an oversea market investment mode has been considered one of the most important strategic decisions in the enterprises international market expansion by academia and practice managers.As an important theoretical perspective in the field of international business research,institutional theory provides an important theoretical foundation for explaining institutional factors and enterprises’ oversea market investment mode.However,the existing research results on the relationship between institutional distance and enterprises’ oversea market investment mode are inconsistent,which will adversely affect the subsequent research in this research field.Therefore,this paper divides the institutional distance into two dimensions: formal institutional distance and informal institutional distance,and uses the meta-analysis method to examine its relationship with three types of enterprise’s overseas investment modes,which are entry mode,establishment mode and equity participation mode.In addition,we also examine the moderate effect of informal institutional distances in the relationship between formal institutional distances and enterprises’ overseas market investment mode.Through the collection and screening of relevant research literatures,a total of 85 sample papers were obtained.The results show that:(1)The formal institutional distance has no significant influence on the choice of the enterprise’s oversea market investment entry mode,but the greater the informal institutional distance,the more the multinational enterprises prefer to choose the joint venture as an overseas market entry mode;(2)the formal institutional distance and the informal institutional distance have a positive impact on the enterprise overseas market establishment mode.That is,the greater the distance between the formal or the informal institutional distance,the more the multinational enterprises prefer to choose greenfield investment as their overseas market establishment mode;(3)The formal institutional distance has no significant influence on the choice of the enterprise’s overseas equity participation mode,but the larger the informal institutional distance,the more the multinational enterprises prefer to choose lower equity stake to enter the host country market;(4)the informal institutional distance strengthens the negative relationship between formal institutional distance and the enterprise’s overseas market entry mode,and also strengthens the negative relationship between formal institutional distance and the enterprise’s overseas market equity participation mode,but it has not significant effect on the relationship between formal institutional distance and the enterprise’s overseas market establishment mode.