Department of Management
The timing of market entry and firm performance: A perspective of institutional theory
Integrating literature from institutional theory with that from market entry research, we study the effects of a firm's early marketing entry on other firms' behaviors and performances. In addition, we also consider the moderating effect of other institutional factors, such as the firms' home-country culture and institutional environments in an emerging economy. Based on a review of all the relevant research, we develop a theoretical model with testable hypotheses. With empirical data from multi-national enterprises (MNEs) competing in China's insurance-service market, we test the hypotheses. Our data analyses show evidence that, other things being equal, early market entry can cause institutional imitation, in terms of market diversification, among imitators. At the same time, the imitation can be moderated by the home-country culture of the MNEs. In addition, the imitation of early market entry firms has some significant effects on the performance of imitators, including less deviation from the industry norm and better financial performance. © 2014 Elsevier Inc.
China, Early market entry, Institutional theory, Performance
Source Publication Title
Industrial Marketing Management
Link to Publisher's Edition
Li, Yongqiang, Ji Li, and Zhenyao Cai. "The timing of market entry and firm performance: A perspective of institutional theory." Industrial Marketing Management 43.5 (2014): 754-759.