Existing studies on strategic balance view have investigated the tension and balance between legitimacy and competition in a well-established group, but it is unclear how do these two forces work in a context where multi-subgroups are interacted. Drawing on the collective identity and organizational legitimacy theories, this study extends the strategic balance view and further examines how multinationals in an emerging subgroup balance the complicated tension of legitimacy and competition both across and within subgroups. Using a panel data of CNBS from 2003~2007, the results shown that conforming to local norms and maintaining moderate level of distance increase foreign firms?? performance the most. Theoretical and practical implications are discussed.
Academy of Management Proceedings, 2016 (Meeting Abstract Supplement) 18314