The assertion of governmental influence on Outward Foreign Direct Investment effectively remains unsubstantiated. In this study we juxtapose the investment directives of China's government with the overseas investment decisions of Chinese firms between 1990 and 2010 to examine the state's effectiveness in orchestrating outward M&A. Using a compliance index we find limited evidence for the steering capacity of China's state. Instead, directives based on the overseas exploration efforts of China's private sector curtail the entrepreneurial rents of first movers. Only firms of central interest to China's state enjoy the comforts of compliance. The illusion of orchestration is then most effective in its evocative power of shaping the publics’ perception of the government's legitimacy.
Dr. Johannes Meuer will talk about the topic “Does China's (Central) Government Matter? The Effectiveness of the Chinese State in orchestrating Outward M&A” (see attached Abstract). Dr. Meuer is a post-doctoral researcher at the RSM Research Centre on China Business, Erasmus University, and a visiting fellow of the Cranfield School of Management. He finished his doctoral thesis on the “Configurations of Inter-Firm Relations in Management Innovation: A Study in China's Biopharmaceutical Industry” at the Erasmus University Rotterdam in 2011.