Navigating in the Institutional Jungle of China - An Investigation of Competitive Advantages Through the Management of Institutional Contexts

Sammanfattning: Purpose: The purpose is to explore the institutional forces in a transitional regulated economy. Furthermore, the study seeks to gather information about firms’ perception of these forces and the way by which these firms seek to handle them and use them to build competitive advantages. Methodology: The study is of qualitative character with an instrumental case study design and a mix of deductive and inductive research approaches. The main data used in the study is collected from in-depth interviews with representatives from three different actors in the dairy market. Beyond the interviews, secondary data is used for additional perspectives and clarification. Theoretical perspectives: The study is based on institutional theory and its institutional-based view. This is combined with the resource-based view and industrial organization economics for the creation of a theoretical framework that maps the creation of competitive advantages through management of institutions. Empirical foundation: China as a transitional regulated economy and its dairy industry is the studied setting. This context was found to be suitable due to the prominent institutional environment and instability. Conclusions: We conclude that there is relevance for firms in the recognition of the institutions in the investigated context. There are certain capabilities and strategies that are useful and lead to development of competitive advantages through better management of the institutional context.