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Fall 2017
ISSN 0890-913X
Volume 32, Number 3

Cronyism from the Perspective of the Firm: A Cross-National Assessment of Nonmarket Strategy

John A. Parnell, University of North Carolina, Pembroke
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TheJournalofPrivateEnterprise32(3),2017,4774CronyismfromthePerspectiveoftheFirm:ACross-NationalAssessmentofNonmarketStrategyJohnA.ParnellUniversityofNorthCarolina,Pembroke______________________________________________________AbstractNonmarketstrategy(NMS)referstoanypartofafirmsstrategythatseekstogeneratesuperiorperformancethroughmeansnotdirectlyassociatedwithmarketactivity.Thispaperinvestigateslinksamongenvironmentaluncertainty,strategiccapabilities,competitive(market)strategy,NMS,andorganizationalperformanceinChina,Ghana,Turkey,andtheUnitedStates.FindingssuggestthatfirmsinrelativelyweakcompetitivepositionsaremorelikelytoemphasizeNMS.InChina,Ghana,andTurkey,compositemodelssuggestthatcompetitiveuncertaintydrivesNMS,butthatonlycompetitivestrategiesnotNMSdriveperformance.IntheUnitedStates,NMSappearstobedrivenbybothcompetitiveandtechnologicaluncertainties,whilealsodrivingperformance.UnliketheircounterpartsinChina,Ghana,andTurkey,AmericanfirmsappeartoemphasizeNMSasaresponsetoenvironmentaluncertaintyandengenderstrongerperformanceasaresult.______________________________________________________JELCodes:D2,L1,L2Keywords:nonmarketstrategy,NMS,strategicpoliticalemphasis,corporatepoliticalanalysis,cronyism,competitivestrategy,uncertainty,strategiccapabilitiesI.IntroductionThestrategicmanagementfieldevolvedfromindustrialorganization(IO)economicsdecadesagoasscholarsbegantofocusonfirmeffortstodevelopandsustaincompetitiveadvantage.Nonmarketconcernshavealwaysexisted,butinpastdecadeswereconsideredperipheraltomarket-orientedstrategicaction(BachandAllen2010;Baron1995;Mellahietal.2016;Weietal.2016).Today,withtheheightenedemphasisoncorporatesocialresponsibility(CSR)andthecontinuederosionoffreeenterpriseintheWest,nonmarketconsiderationshaveassumedgreaterprominence.
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