International Expansion, Diversification and Regulated Firm Nonmarket Strategy

Abstract : Previous studies have shown that regulated firms diversify for reasons that are different than for unregulated firms. We explore some of these differences by providing a theoretical model that starts by considering the firm-regulator relationship as an incomplete information issue, in which a regulated incumbent has knowledge that the regulator does not have, but the firm cannot convey hard information about this knowledge. The incumbent faces both market and nonmarket competition from a new entrant. In that context, we show that when the firm faces tough nonmarket competition domestically, going abroad can create a mechanism that makes information transmission to the regulator more credible. International expansion can thus be a way to solve domestic nonmarket issues in addition to being a catalyst for growth
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Managerial and Decision Economics, Wiley, 2013, 34 (6), pp.379-396. 〈10.1002/mde.2598〉
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Soumis le : mercredi 21 août 2013 - 11:16:01
Dernière modification le : jeudi 11 janvier 2018 - 06:19:31

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Santiago Urbiztondo, Jean-Philippe Bonardi, Bertrand Quélin. International Expansion, Diversification and Regulated Firm Nonmarket Strategy. Managerial and Decision Economics, Wiley, 2013, 34 (6), pp.379-396. 〈10.1002/mde.2598〉. 〈hal-00852603〉

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