Angel investor's selection criteria: a comparative institutional perspective

Despite the important role of angel investors as critical financial providers for new ventures, little is known regarding how institutions make their investment decisions. While angels make decisions based on selection criteria during the first stage, they are also embedded within and affected by different institutional settings and as a result weight these criteria differently than other investors. We compare angel investors' selection criteria in China and Denmark using the comparative institutional perspective. We use a policy capturing approach and hierarchy linear modeling, revealing that since Chinese angels are embedded within relationship-based institutional settings they tend to reply more on strong ties such as family and friends in management team, as well as weighting risks less compared to Danish angels operating within more rule-based institutional contexts

Corporate governance and national institutions: A review and emerging research agenda

We present a critique of corporate governance research grounded in agency theory and propose that cross-national comparison of corporate governance should consider how the nature and extent of agency relationships differ across different institutional contexts. Building on prior governance studies grounded in sociology and organizational theory we argue that performance outcomes of boards of directors, ownership concentration, and executive incentives may differ depending on the legal system and institutional characteristics in a specific country. Institutions may also affect the extent of complimentarity/substitution among different firm-level governance practices producing patterned variations in firm-level governance mechanisms. Our discussion suggests that researchers need to develop more holistic, institutionally embedded governance framework to analyze organizational outcomes of various governance practices

Theories of the (state-owned) firm

State-owned enterprises (SOEs) contribute approximately 10% of the world’s GDP. SOEs at one time were predicted to disappear from the economic landscape of the world, but today SOEs are growing more prevalent in the world economy. The current theories of the firm that form the pillars of the management discipline largely ignore the theoretical differences that SOEs introduce into the conceptualization of the firm. Therefore, we extend four core theories of the firm by incorporating SOEs as a mainstream (not special or marginal) organizational form into these theories. We focus specifically on property rights theory, transaction cost theory, agency theory, and resource-based theory, culminating in a research agenda with 12 testable propositions

Insider Control and the FDI Location Decision

This paper examines the FDI location strategies of firms from one of the Asian NIEs (Taiwan) in a rapidly emerging market (China). Although there is a substantial literature on FDI location choice, most studies model the choice as a function of a range of location-specific attributes such as local market size, labour costs etc. Few studies consider the impact of firm-specific characteristics, other than potential country-of-origin effects. Yet locations, and especially those in emerging markets where institutions are weak and capital markets are immature, also differ in terms of their risk. Different shareholder constituencies within the parent company will typically have different preferences with regard to risk, and are therefore likely to favour some locations over others. We find that the ownership structure of the parent company matters with regard to its FDI location decision and, in particular, that both family and non-family insider shareholders exert influence over the choice of location. Furthermore we show that firms¿ location and entry mode choices are inter-related, and establish that the extent of their resource commitments in their foreign affiliates leads parent companies to favour locations where the perceived risks are lower. Finally we show that the efficacy of firms¿ external relational linkages varies according to the strength of the cultural and historic ties between the location of the foreign affiliate and the home country