In pursuit of the profound, the innovative, and the visionary


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Co-Founder & Former Associate Editor

      Transnational Corporations Review


Ad-Hoc Reviewer

      Journal of International Business Studies

      Organization Science

      Entrepreneurship Theory and Practice

      Journal of World Business

      International Business Review

      Management International Review

      Multinational Business Review

      Asia Pacific Journal of Management

      Journal of Business Research

      Corporate Governance: An International Review

      Columbia FDI Perspectives

      Canadian Public Policy























































English Bay, Vancouver, Canada




“The economic problem of a society is mainly one of rapid adaptation in the particular circumstances of time and space.”

--Friedrich A. Hayek (1945: 524)


Figure 1. My “Space-Time-Adaptation” philosophy for knowledge expansion

Arrows suggest three dimensions of knowledge expansion from ignorance.

Outer elements suggest knowledge infrastructures through which knowledge should be created and integrated.


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My research covers four interrelated areas:

1) diversity and dynamics of economic, social, and political institutions worldwide;

2) business strategy from a top management perspective that adapts to such diversity and dynamics;

3) emerging markets, which offer large variations in institutional diversity and dynamics to study business strategy;

4) (re)designing the science-practice ecosystem for business administration.


Leadership | Selected Working Papers | Selected Scholarly Publications | Selected Publications for Managers & Policy Makers | Full List








Founding coordinator (2018 – Present): Global OpenLabs for Performance-Enhancement Analytics and Knowledge System (




Synopsis: After more than six decades of scientific research of business administration, the stock of our knowledge is at a volume that makes knowledge synthesis for business applications possible, and meanwhile makes knowledge creation activities more confused without a shared knowledge navigation system. Like the pharmaceutical industry which historically emerged as a new ecosystem to synthesize scientific research into medicines as well as to guide and fund basic research, time is ripe to (re)invent a science-practice ecosystem in business administration to synthesize disperse scientific findings into business analytics tools and to more systematically guide and fund academic research. I thus propose a new industry-academia research partnership named “Global OpenLabs for Performance-Enhancement Analytics and Knowledge System” (or “GoPeaks” for short).


Consisting of many globally coordinated labs in both the academia and the industry, GoPeaks’ goal is to consolidate disperse theoretical and empirical efforts from all academic sources (journals, books, working papers, teaching cases, patents, etc.) into a unified digital library that organizes and updates all variables and models to comprehensively predict business performance at multiple levels and from multiple stakeholder perspectives. It is also an Amazon-style exchange platform for knowledge creators (researchers) and knowledge users (decision makers, analytics professionals) to communicate and share resources (e.g., model for data; data for model; merging data into data platforms; integrating models into meta-frameworks, etc). In essence, this initiative is an interface between consolidated knowledge (e.g., meta-frameworks) from academia and consolidated resources (e.g., merged big data from multiple sources, etc.) from the industry. See more at



Global Coordinator & Editor (2011 – Present): Emerging Market Global Players, Columbia Center on Sustainable Investment





Synopsis: The Emerging Market Global Players (EMGP) project, a collaborative effort led by CCSI, brings together researchers on FDI from leading institutions in emerging markets to gather original data from company surveys and additional research and to produce annual reports based on their findings. Those EMGP reports identify the top multinationals from each of a number of emerging markets, provide detailed information on the key features of the firms’ activities abroad, and discuss other issues, including the underlying policy context influencing outward investment from those emerging markets and the impact of the MNEs on sustainable development. More at






Working paper 1: Socializing shareholders in agency theory, with R Aguilera



Synopsis: We develop a socialized agency theory to incorporate two key components of social diversity of shareholders into the traditional agency theory. First, we extend the market logic of shareholder value (“how much”) into the social logic of shareholder values (“what for”). We then conceptualize the shareholder objective conflicts as a vector of distance between shareholders in the spectrum of market and social logics. Second, we draw on shareholder power to include both property rights and social pressures. We suggest power inequality between shareholders should encompass both forms of power. We use this categorization of shareholders to predict whether they use voice and exit to discipline the managerial behavior. Our paper builds a more integrative and realistic conceptual framework to understand the conflicts between powerful shareholders in corporate governance that are ubiquitous around the world.


Working paper 2: Complexity and evolution of globalization, with J Cantwell



Synopsis: “Foreignness” has been a key construct in globalization studies. However, drawing social boundaries simply in national terms fails to capture the full range of diversity and complexity entailed by globalization. Drawing on evolutionary theorizing, we develop a new typology of outsidership in global business contexts. We suggest that a series of mutually exclusive and sequential social “replicators” jointly program individual and organizational behaviors and give rise to distinct path-dependent social trajectories. These replicators include genes, pre-linguistic habits, grammatical languages, customs, writing systems, judicial systems, and scientific paradigms. Outsidership is conceptualized as being historically outside a shared path of these replicators.


Working paper 3: A critical review of management knowledge ecosystem, with MA Hitt



Synopsis: A major challenge facing business schools is the divergence between practical demand for integration and scientific knowledge fragmentation. Using examples of a select list of elite management journals created in response to the 1950s science movement, we discuss the risks of potentially broadening this gap because of: (1) limited introduction of knowledge from foundational disciplines; (2) a limited definition of “interesting” and “counterintuitive” knowledge; (3) discipline silos with a narrow theoretical focus and bounded values and assumptions; (4) over-generalizations of theories and findings. In the context of the overall management knowledge ecosystem, we recommend addressing three major constraints that limit our ability to reduce the gap between practical demand for integration and scientific knowledge fragmentation. First, new technologies could be introduced to assist researchers and editors in the development of a complete review of existing theories and evidence. Second, new publication outlets could be designed to serve as IT-enabled, web-based knowledge synthesis platforms. Third, business schools could develop new incentives system to enable and promote the use of these new initiatives.








Chen VZ, Hobdari B, Zhang Y. 2018. Blockholder heterogeneity and conflicts in cross-border acquisitions. Journal of Corporate Finance, in press. (Special issue on “Corporate governance of multinational enterprise”).


Abstract: We investigate the principal-principal (PP) conflicts between large blockholders in the context of cross-border acquisitions (CBAs). We focus on the conflicts between family blockholders and two groups of financial institutional investors – banks and mutual funds. We hypothesize that different types of blockholders have heterogeneous preferences with respect to the CBA decision and outcomes. We suggest that the PP conflicts in CBA differ across the blockholders. Banks are pressure sensitive and cooperative with the management because of their clientele relationship with firms, while mutual funds are subject to more financial scrutiny and independent from the management, making them pressure resistant. When in conflict with more powerful family blockholders, mutual funds will choose to exit after a CBA decision, whereas banks are more likely to stay. With an equally distributed voting power, family and mutual fund blockholders will be more motivated to monitor over each other and jointly discipline the management, leading to more careful selection of CBAs and higher overall shareholder value. However, such effects are weak in the case of family and banks. We find support for these conjectures using data on CBAs undertaken by US public firms over the period 2003-2016. Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Chen VZ, Musacchio A, Li S. 2018. A principals-principals perspective of hybrid Leviathans: Cross-border acquisitions of state-owned MNEs. Journal of Management, in press.


Abstract: We propose a private-government principals-principals (PP) approach to understand corporate governance of state-owned multinationals. We explain how the conflicts between large government and private blockholders may affect managerial decisions in the propensity of completing a cross-border acquisition and its dollar value. We argue that conflicts among different blockholders make it difficult to pursue large-scale, cross-border deals because such conflicts may lead to a less coherent objective function and to reject deals that do not satisfy these groups’ conflicting objectives. Finally, we show that such blockholder conflicts are moderated by the salience of the government’s “dual influence” on the firm in question, related to a state’s soft-budget constraint and/or diplomatic advantages in countries where the host and the home markets do not enjoy a bilateral investment treaty. Empirically, we have found highly supportive evidence based on a global sample of 7,564 cross-border acquisitions between the years of 2004 and 2013. Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Chen VZ, Sun SL. 2018. Barbarians at the gate of the middle kingdom: The international mobility of financing contract and governance, Entrepreneurship Theory and Practice, in press.


Abstract: Focusing on equity ratchet as a practice, we study how foreign private equity (PE) investors interacted with local agents in the process of legitimation and legalization of foreign financing contract and governance in the Chinese PE industry, while it was underdeveloped. Based on seven cases in China, we propose a three-stage micro-process model of international institutional entrepreneurship in an emerging field with high ambiguity: framing a motivational vision to promote a new practice; early adoption by local non-mainstream agents who gain legitimacy from diverse sources of institutional logic; and dominant mainstream adopters seeking legal protection to sustain their benefits. Our theory extends the emerging discussion on the transfer of corporate governance and institutional entrepreneurship across borders. Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Sun SL, Chen VZ, Sunny SA, Chen J. 2018. Venture capital as an innovation ecosystem engineer in an emerging market. International Business Review, in press. (Special issue on "Competitive dynamics and co-evolution of MNCs and local rivals in emerging markets").


Abstract: How can venture capital (VC) firms transform a weak innovation ecosystem into a productive and robust one? While the literature has found VC firms’ catalyst role in innovation in developed markets, we know little about whether and how they affect innovation in an emerging market, where formal institutions (e.g., regulations and markets) and informal institutions (e.g., professional networks) to enable VC firms’ catalyst role are relatively lacking. First, we argue that VC firms play a different and more proactive role in these markets as an “ecosystem engineer” through governing the resource flow and selecting deviation, which drive regional innovation performance. Second, such effects are further positively moderated by the presence of multinational enterprises (MNEs) in a region. Lastly, over time, while the direct effects of VC firms persist and increase, the moderating effects of MNE presence decline. Empirically, we examined a Chinese provincial-level panel data of VC activities (1999-2009) and patent applications (2000-2010) and found supportive evidence. Implications are discussed. Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Chen VZ, Li J, Shapiro DM, Zhang XX. 2014. Ownership structure and innovation performance: An emerging market perspective, Asia Pacific Journal of Management, 31(1), 1-24. (2014 Best paper award)


Abstract: Considerable attention has been focused on the ways in which emerging market firms can obtain and mobilize the knowledge and resources required for innovation. Innovation is a particular challenge in emerging markets because of inadequate external institutions. In this study, we focus on the importance of ownership structure, and in particular on ownership type diversity and ownership concentration. Using transaction cost and agency theories embedded in an emerging market context, we argue that ownership structure provides an important mechanism by which firms can assemble and direct the resources necessary for innovation in the context of inadequate external institutions. Specifically, we hypothesize that ownership type diversity improves innovation performance and that increasing ownership concentration has the same effect, but only up to a point. Using a self-tailed panel data of 487 and 475 Chinese listed companies during 2004-2005 and 2005-2006 respectively, we find supportive empirical evidence for our hypotheses. Our findings also suggest ownership type diversity has a more significant statistical effect on innovation performance than does ownership concentration, although most of the extant literature focuses on the latter. Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Li J, Newenham-Kahindi A, Shapiro DM, Chen VZ. 2013. The two-tier bargaining model revisited: Theory and evidence from China’s natural resource investments in Africa. Global Strategy Journal, 3, 300-321.


Abstract: In recent years, foreign direct investment (FDI) in natural resource industries by Chinese firms in Africa has increased rapidly. The strategic importance of the natural resource sector to host country governments produces considerable bargaining over entry and operating terms, with attendant political risks. Using case studies in Tanzania, we find that the Chinese government and firms engage in a bargaining model different from the traditional models. Specifically, they engage in a modified one-tier bargaining model in which the Chinese government represents the collective interests of Chinese natural resource firms to negotiate with the host country government. In exchange for investment deals in the natural resource sector, the Chinese government offers a package with loans that support multiple-purpose development projects in various sectors, with a focus on infrastructure. Chinese firms act as a group to fulfill the Chinese government’s commitments to the host country government. We discuss the boundary conditions for this Chinese-style bargaining model and its relationship to political risk. We conclude that the Chinese model has unique elements, although they are likely limited to resource investments in developing countries. Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Chen VZ, Li Y. & Hambright S. (2016). Regulatory institutions and Chinese outward FDI: An empirical review. Multinational Business Review, 24(4), 302-333.


Abstract: This paper seeks to review the effects of home regulatory institutions on outward FDI (OFDI) in the context of China and discuss the extent to which they can be extended to other emerging markets. We especially compare these empirical studies with theoretical discussions in each category, identify research gaps, and suggest future research ideas. It focuses specifically on three categories of regulatory institutions, including overall institutional development, liberalization of OFDI policies, and state ownership (and its closely approximate forms). Using a systematic review, this paper has reviewed 26 empirical studies (23 quantitative and 3 qualitative studies) published in peer-reviewed journals. These studies suggest that overall institutional development towards a market economy in general leads to increased OFDI, but this effect is contingent on the stage of such development and the capabilities of Chinese multinationals. Liberalized and supportive OFDI policies also facilitate OFDI activities, but only into selective areas. Findings on state ownership have been mixed. This review offers a full picture of empirical evidence on how multiple levels of regulatory institutions affect OFDI from China. In this way, we can identify the research gaps between theoretical discussions on home institutions and OFDI and empirical evidence. Thus we make suggestions for future directions of studies. Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Chen VZ, & Johnson LL. (2014). Emerging market multinationals and social responsibility: An institutional pressure perspective (Editorial summary). Transnational Corporations, 22(3), 1-4.


Abstract: While there is a growing body of literature focusing on EMNEs (for reviews, see Gammeltoft, Barnard, and Madhok, 2010; Luo and Tung, 2007; Ramamurti, 2012), many issues about these firms’ development effects remain underexplored. It is for this reason that we organized this special issue. The three articles that are part of this collection highlight the most salient and pressing issues regarding EMNEs: In what sectors and locations are EMNEs investing, and what impacts might these investments have on sustainable development? Are EMNEs dedicating efforts to corporate social responsibility (CSR) and if so, through what types of activities? What is driving the firms’ engagement with CSR? And how can and should institutions in home countries, host countries, and many initiatives targeting MNEs – e.g., the IFC Performance Standards, the Voluntary Principles on Security and Human Rights, and the OECD Guidelines for Multinational Enterprises – have typically been launched and influenced by developed countries and their firms, emerging markets and EMNEs are increasingly playing a role; and with initiatives such as the BRICS New Development Bank, that role will continue to expand and become even more crucial for ensuring the contribution of international investment to sustainable development. Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Sauvant KP & Chen VZ (2014). China needs a “going in” strategy to complement its “going out” strategy”. Columbia FDI Perspectives, No. 121.


Abstract: China’s rising outward foreign direct investment (OFDI) faces rising skepticism abroad. This is partly the result of the leading role of state-owned enterprises in her OFDI (and the fear that it serves non-commercial purposes), the speed with which this investment has grown, the negative image of the home country in some quarters, and the challenges it poses to established competitors. Moreover, Chinese multinational enterprises (MNEs) may not always keep in mind that host countries see FDI as a tool to advance their own development and hence seek maximum benefits from it. Description: Description: Description: Description: Description: Description: Description: Description: Description:





Sauvant KP & Chen VZ (2013). China’s regulatory framework for outward foreign direct investment. China Economic Journal, 7(1), 141-163(Listed on Taylor & Francis most read articles in 2014 in Social Sciences)


Abstract: China has become the world’s third largest outward investor, behind the United States and Japan. A growing body of literature suggests that China’s regulatory framework for outward foreign direct investment (OFDI) is a determinant of the country’s rising OFDI. This paper presents a holistic review of that framework, including some possibilities for its improvement. Overall, China’s framework serves two objectives: to help Chinese firms become more competitive internationally and to assist the country in its development effort. In pursuing these objectives, the regulatory framework has moved from restricting, to facilitating, to supporting, to encouraging OFDI; but there are still strong elements of administrative control that make it cumbersome. State-owned enterprises (SOEs) seem to benefit particularly from the current framework when internationalizing through FDI.Description: Description: Description: Description: Description: Description: Description: Description: Description:



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Globerman S & Chen VZ (2010). Best policy practices for promoting inward and outward foreign direct investment. Ottawa, Canada: Conference Board of Canada.


Abstract: This report identifies and discusses best practices to attract and promote inward and outward foreign direct investment. To better inform Canadian policy-making at various levels of government, this report provides an extensive and systematic review of the empirical evidence on the public policies and other factors that influence foreign investors. The report also evaluates which policies and other factors affect the degree to which foreign direct investment improves productivity and leverages other benefits in the economies receiving the investment. Description: Description: Description: Description: Description: Description: Description: Description: Description:





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