Jamie Hurst jamie.l.hurst@durham.ac.uk
PGR Student Doctor of Philosophy
A comparative Analysis of Institutional Arbitrage Strategies in Emerging and Developed Market MNEs: exploring tax haven subsidiary incorporation
Hurst, Jamie; Sutherland, Dylan
Authors
Professor Dylan Sutherland dylan.sutherland@durham.ac.uk
Professor
Abstract
This paper explores: 1) the extent to which emerging market MNEs, owing to their generally fragile and weaker domestic institutional environments, are more predisposed towards institutional arbitrage related FDI than developed market MNEs; 2) identifies whether their institutional arbitrage behaviours are less responsive to domestic institutional change than those of developed market MNEs. We consider these questions by using the number of offshore tax haven-based subsidiaries as a proxy for institutional arbitrage activity in 10,892 publicly listed developed market MNEs and 7,243 listed emerging market MNEs. Our results show EMNEs, other things being equal, do indeed have a higher propensity for offshore incorporation. At the same time, however, EMNEs appear less responsive to institutional change than DMNEs. We consider implications for extant mainstream EMNE related IB theory, such as the 'springboard theory', which predicts differences between these MNE types with regards to institutional arbitrage orientation and strategy.
Citation
Hurst, J., & Sutherland, D. (2024). A comparative Analysis of Institutional Arbitrage Strategies in Emerging and Developed Market MNEs: exploring tax haven subsidiary incorporation. International Journal of Business and Emerging Markets, 16(3), https://doi.org/10.1504/IJBEM.2024.10057886
Journal Article Type | Article |
---|---|
Acceptance Date | Jun 9, 2023 |
Online Publication Date | Jul 2, 2024 |
Publication Date | Jul 2, 2024 |
Deposit Date | Jun 15, 2023 |
Publicly Available Date | Oct 7, 2024 |
Journal | International Journal of Business and Emerging Markets |
Print ISSN | 1753-6219 |
Electronic ISSN | 1753-6227 |
Publisher | Inderscience |
Peer Reviewed | Peer Reviewed |
Volume | 16 |
Issue | 3 |
DOI | https://doi.org/10.1504/IJBEM.2024.10057886 |
Keywords | institutional arbitrage, FDI, emerging market MNEs, developed market MNEs, institutional fragility, tax havens |
Public URL | https://durham-repository.worktribe.com/output/1170117 |
Publisher URL | https://www.inderscience.com/info/ingeneral/forthcoming.php?jcode=IJBEM |
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http://creativecommons.org/licenses/by/4.0/
Copyright Statement
This accepted manuscript is licensed under the Creative Commons Attribution 4.0 licence. https://creativecommons.org/licenses/by/4.0/
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