journal article Jul 08, 2014

Business groups in developing capital markets: Towards a complementarity perspective

Strategic Management Journal Vol. 36 No. 9 pp. 1277-1296 · Wiley
Abstract
Prior research suggests that business groups (
BG
s) in developing economies have emerged as alternatives to poorly developed economic institutions in these countries. In this paper, we argue that this does not imply they are always substitutes. Specifically, we consider the case of capital markets, a key economic institution: while the absence of well‐developed capital markets may indeed have stimulated the emergence of business groups, we propose that
BG
affiliation and the scrutiny that maturing capital markets impose on firms that participate actively in them nevertheless can play a complementary role in influencing a firm's performance. We find support for our predictions in a novel longitudinal data set of Indian firms that contain both listed and unlisted
BG
affiliated as well as unaffiliated firms

. Copyright © 2014 John Wiley & Sons, Ltd.
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152
Citations
67
References
Details
Published
Jul 08, 2014
Vol/Issue
36(9)
Pages
1277-1296
License
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Funding
European Research Council Award: 241132
Cite This Article
Raveendra Chittoor, Prashant Kale, Phanish Puranam (2014). Business groups in developing capital markets: Towards a complementarity perspective. Strategic Management Journal, 36(9), 1277-1296. https://doi.org/10.1002/smj.2287
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