Title: Responding to the multi-faceted liabilities of origin for emerging market MNEs: a cognitive institutional entrepreneurship perspective

Authors: Bo Yang; Pao T. Kao; Wensong Bai; Tingting Jiang

Addresses: School of Economics, Tianjin University of Finance and Economics, Hexi, Tianjin, China; Business School, Nankai University, Tianjin, China ' Department of Business Studies, Uppsala University, Uppsala, Sweden ' Department of Economics, Shenzhen MSU-BIT University, Shenzhen, Guangdong, China ' School of Business Administration, Zhejiang Gongshang University, Hangzhou, Zhejiang, China; Zheshang Research Institute, Zhejiang Gongshang University, Hangzhou, Zhejiang, China

Abstract: Liabilities of Origin (LORs) are a unique challenge for Emerging Market Multinational Enterprises (EMNEs) in internationalisation especially in the advanced markets. In this study, we ask research questions: what types of stereotypes from the host country stakeholders may contribute to EMNEs' LORs, and how do EMNEs change these stereotypes over time? We conduct a case study on Chinese telecom Huawei and examine its entries in European and US markets. Our findings show three types of country-of-origin stereotypes: capability-, ethics- and government and enterprise relationship-based stereotypes contribute to LORs. We also find that EMNEs adopt three cognitive institutional entrepreneurship strategies: differentiation, replacement and complementation to address these stereotypes. Our study provides a more fine-grained understanding of the relationship between stereotypes and LORs, and provides a new perspective for EMNEs to mitigate multi-faceted LORs. We also contribute to institutional entrepreneurship research by discussing it at cognitive level.

Keywords: liabilities of origin; cognitive institutional entrepreneurship; country-of-origin stereotype; legitimacy; foreign direct investment; emerging market multinational enterprises; case study.

DOI: 10.1504/EJIM.2025.144605

European Journal of International Management, 2025 Vol.25 No.3/4, pp.645 - 678

Received: 12 Jul 2021
Accepted: 30 Jun 2022
Published online: 25 Feb 2025 *

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