Corporate political activity and location-based advantage: MNE responses to institutional transformation in Uganda’s electricity industry

Mbalyohere, Charles; Lawton, Thomas; Boojihawon, Roshan and Viney, Howard (2017). Corporate political activity and location-based advantage: MNE responses to institutional transformation in Uganda’s electricity industry. Journal of World Business, 52(6) pp. 743–759.

DOI: https://doi.org/10.1016/j.jwb.2017.06.006

Abstract

We examine how multinational enterprises (MNEs) employ political strategies in response to location-based, institutional transformations in new frontier African markets. Specifically, we explore the heterogeneous corporate political activities of advanced and emerging market MNEs in Uganda’s electricity industry, as they respond to and influence locational advantage using diverse political capabilities. We argue that, in institutionally fragile, new frontier markets, Dunning’s OLI paradigm is more theoretically robust and managerially relevant when combined with a political perspective. Effective MNE political strategies in these markets rely on nonmarket capabilities in political stakeholder engagement, community embeddedness, regional understanding, and responsiveness to stages of institutionalization.

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