Research On The Influence Of Executives' Social Network On Enterprises' OFDI

In recent years,with the encouragement and promotion of China's "going out" strategy and the "Belt & Road" initiative,China's Outward Foreign Direct Investment(OFDI)has increased significantly,and more and more Chinese companies have begun to go abroad and to take a positive attitude to integrate and participate in the development of the world economy.The vigorous development of China's OFDI has aroused widespread concern in the world,and the factors affecting Chinese enterprises' OFDI have gradually become a hot topic for scholars at home and abroad.Although China's OFDI is in a period of rapid development,the proportion of failures among many Chinese enterprises with OFDI is still large.This is mainly because enterprises do not have a comprehensive and in-depth understanding of the influencing factors of OFDI and are unable to fully formulate reasonable OFDI strategies based on their own conditions and external environment.Although the existing research has studied the influencing factors of Chinese enterprises' OFDI from the macro and micro level,it has not penetrated into the internal level analysis of enterprises,only staying at the surface characteristics of enterprises,and failed to analyze the factors influencing the difference at the root of the enterprise's OFDI decision,ignoring the role of executives,the decision-making body of enterprises.In view of the shortage of the existing research,this paper is based on Resource Dependence Theory and Upper Echelons Theory,takes China's A-share listed companies from 2008 to 2015 as the research object,from the perspective of the enterprise internal decision makers,from the three dimensions of political connection,financial connection and associational connection to study the influence of executives' social network on the enterprises' OFDI and the corresponding influence mechanism.In addition,this paper considers the regulating effects of the ownership,product market competitiveness,and external market environment on the relationship between executives' social network and enterprises' OFDI,and also analyzes the different impact of executives' social network on the choice of host country and the economic consequences of the relationship between executives' social network and OFDI.The findings are as follows:(1)the social network of executives can significantly improve the probability that enterprises adopt the strategy of OFDI,and different types of social networks have interaction relations;(2)the corresponding influence mechanism is verified through mediation effect analysis,that is,the executives' social network promotes the implementation of OFDI strategy by alleviating financing constraints;(3)the ownership,product market competitiveness and external market environment of enterprises can all play regulating effects,as follows: the promotion of the three kinds of social network is more significant in the state-owned enterprises;the promotion of political connection and financial connection is more significant in the enterprises with higher levels of competitiveness in the product market;while associational connection is reversed;the promotion of financial connection and associational connection is more significant in the enterprises in regions with lower levels of marketization;(4)executives' social network will affect the choice of host country,that is political and financial connections will promote OFDI in developing countries,the association connection will promote OFDI in developed countries,and the relationship between executives' social network and OFDI will significantly improve the business performance of enterprises.The conclusions of this paper highlight the important influence of the informal institutional arrangement of executive social network on enterprises' OFDI and have important theoretical and practical implications for the effective implementation of enterprises' OFDI.