Skip to main content
SpringerLink
Log in

Liabilities of Foreignness and Outsidership in the Evolution of Immigrant Chinese Entrepreneurship

  • Chapter
  • First Online:
Native and Immigrant Entrepreneurship

  • 716 Accesses

Abstract

This chapter investigates how the immigrant Chinese companies evolve and face their liability of foreignness and liability of outsidership (concepts borrowed from the international business field) in the industrial district of Prato. The chapter adopts the perspective of the Chinese companies, investigating how those companies overcame their liabilities as they evolved within the industrial district. The immigrant Chinese companies in Prato evolved from an initial subcontractor level to become final firms engaged in diversification; this chapter analyzes the evolution in relation to the local native and immigrant communities. The industrial areas of Prato where the native and immigrant entrepreneurs coexist can generate liabilities. The immigrant Chinese entrepreneurs are insiders to their relevant global networks; however, they can experience a liability of outsidership in the local networks of the native entrepreneurs. Further, the native entrepreneurs may themselves face a liability of outsidership in the global networks in which the immigrant entrepreneurs are embedded.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 89.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 119.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 169.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Notes

  1. 1.

    Psychic distance is defined as the sum of factors preventing the flow of information from and to the market, including differences in language, education, business practices, culture, and industrial development (Johanson and Vahlne 1977).

  2. 2.

    The liabilities of newness, smallness, and aging and how they manifest in a local cross-cultural context are interesting. However, this chapter focuses mainly on the LOF and the LOO.

References

  • Aldrich H, Auster ER (1986) Even dwarfs started small: liabilities of age and size and their strategic implications. Res Organ Behav 8:165–198

    Google Scholar 

  • Becattini G, Bellandi M, De Propris L (2009) Critical nodes and contemporary reflections on industrial districts. In: Becattini G, Bellandi M, De Propris L (eds) A handbook of industrial districts. Edward Elgar, Cheltenham

    Chapter  Google Scholar 

  • Bellandi M (1996) Innovation and change in the Marshallian industrial district. Eur Plan Stud 4(3):357–368

    Article  Google Scholar 

  • Buckley PJ, Casson M (1976) Future of the multinational enterprise. Springer

    Google Scholar 

  • Calhoun MA (2002) Unpacking liability of foreignness: identifying culturally driven external and internal sources of liability for the foreign subsidiary. J Int Manag 8(3):301–321

    Article  Google Scholar 

  • Ceccagno A (ed) (2003) Migranti a Prato. Il distretto tessile multietnico. Milano, Franco Angeli

    Google Scholar 

  • Colombi M (ed) (2002) L’imprenditoria cinese nel distretto industriale di Prato. Leo S. Olschki, Firenze

    Google Scholar 

  • De Marchi V, Grandinetti R (2014) Industrial districts and the collapse of the Marshallian model: looking at the Italian experience. Competition & Change 18(1):70–87

    Article  Google Scholar 

  • Dei Ottati G (2009) Italian industrial district and the dual Chinese challenge. In: Smyth R, Johanson G (eds) Living outside the walls: the Chinese in Prato. Cambridge Scholars Press, Cambridge

    Google Scholar 

  • Dei Ottati G (2013) Imprese di immigrati e distretto industriale: un’interpretazionen dello sviluppo delle imprese cinesi a Prato. Stato e mercato 2:171–202

    Google Scholar 

  • Dei Ottati G (2014) A transnational fast fashion industrial district: an analysis of the Chinese businesses in Prato. Camb J Econ, 1–28

    Google Scholar 

  • Denk N, Kaufmann L, Roesch JF (2012) Liabilities of foreignness revisited: a review of contemporary studies and recommendations for future research. J Int Manag 18(4):322–334

    Article  Google Scholar 

  • Eden L, Miller SR (2001) Opening the black box: multinationals and the costs of doing business abroad. Acad Manag Proc, C1–C6

    Google Scholar 

  • Eden L, Miller SR (2004) Distance matters: liability of foreignness, institutional distance and ownership strategy. Adv Int Manag 16(04):187–221

    Article  Google Scholar 

  • Freeman J, Carroll GR, Hannan MT (1983) The liability of newness: age dependence in organizational death rates. Am Sociol Rev 48(5):692–710

    Article  Google Scholar 

  • Gadde LE, Mattsson LG (1987) Stability and change in network relationships. Int J Res Mark 4(1):29–41

    Article  Google Scholar 

  • Granovetter MS (1973) The strength of weak ties. Am J Sociol, 1360–1380

    Google Scholar 

  • Guercini S (1999) L’impresa con vertice di nazionalità cinese nel distretto pratese: caratteri, processi di sviluppo e politiche di mercato. In: Conference “Il futuro dei distretti”, University of Padua, Vicenza

    Google Scholar 

  • Guercini S (2002) Profilo del vertice, processi di sviluppo e politiche di mercato dell’impresa cinese a Prato. In: Colombi M (ed) L’imprenditoria cinese nel distretto industriale di Prato. Leo S. Olschki, Firenze, pp 35–70

    Google Scholar 

  • Guercini S (2004) International competitive change and strategic behaviour of Italian textile-apparel firms. J Fashion Mark Manag 8(3):320–339

    Article  Google Scholar 

  • Guercini S, Milanesi M, Dei Ottati G (2013) Global and local business networks in the growth of the Chinese firm in Prato. In: 6th Chinese in Prato symposium and 4th Wenzhouese diaspora symposium on Chinese migration entrepreneurship and development in the new global economy, Prato, 29–30 Oct 2013

    Google Scholar 

  • Håkansson H (1982) International marketing and purchasing of industrial goods: an interaction approach. Wiley, Cheltenham

    Google Scholar 

  • Håkansson H, Snehota I (1995) Developing relationships in business networks. Routledge, London

    Google Scholar 

  • Hilmersson M (2013) The effect of international experience on the degree of SME insidership in newly opened business networks. Baltic J Manag 8(4):397–415

    Article  Google Scholar 

  • Hilmersson M, Jansson H (2012) International network extension processes to institutionally different markets: entry nodes and processes of exporting SMEs. Int Bus Rev 21(4):682–693

    Article  Google Scholar 

  • Hymer S (1976) The international operations of national firms: a study of direct foreign investment, vol 14. MIT Press, Cambridge, pp 139–155

    Google Scholar 

  • Johanson J, Vahlne JE (1977) The internationalization process of the firm—a model of knowledge development and increasing foreign market commitments. J Int Bus Stud 8(1):23–32

    Article  Google Scholar 

  • Johanson J, Vahlne JE (2009) The Uppsala internationalization process model revisited: from liability of foreignness to liability of outsidership. J Int Bus Stud 40(9):1411–1431

    Article  Google Scholar 

  • Johanson J, Wiedersheim-Paul F (1975) The internationalization of the firm—four Swedish cases. J Manage Stud 12(3):305–323

    Article  Google Scholar 

  • Kindleberger CP (1969) American business abroad: six lectures on direct investment. Yale University Press, New Haven

    Google Scholar 

  • Luo Y, Mezias JM (2002) Liabilities of foreignness: concepts, constructs, and consequences. J Int Manag 8(3):217–221

    Article  Google Scholar 

  • Matsuo H (2000) Liability of foreignness and the uses of expatriates in Japanese multinational corporations in the United States. Sociol Inq 70(1):88–106

    Article  Google Scholar 

  • Mezias JM (2002) How to identify liabilities of foreignness and assess their effects on multinational corporations. J Int Manag 8(3):265–282

    Article  Google Scholar 

  • Milanesi M, Guercini S, Waluszewski A (2016) A Black Swan in the district? An IMP perspective on immigrant entrepreneurship and changes in industrial districs. IMP J 10(2):243–259

    Article  Google Scholar 

  • Miller SR, Richards M (2002) Liability of foreignness and membership in a regional economic group: analysis of the European Union. J Int Manag 8(3):323–337

    Article  Google Scholar 

  • Petersen B, Pedersen T (2002) Coping with liability of foreignness: different learning engagements of entrant firms. J Int Manag 8(3):339–350

    Article  Google Scholar 

  • Schweizer R (2013) SMEs and networks: overcoming the liability of outsidership. J Int Entrepreneurship 11(1):80–103

    Article  Google Scholar 

  • Sharma DD, Blomstermo A (2003) The internationalization process of born globals: a network view. Int Bus Rev 12(6):739–753

    Article  Google Scholar 

  • Singh JV, Lumsden CJ (1990) Theory and research in organizational ecology. Annu Rev Sociol, 161–195

    Google Scholar 

  • Stinchcombe AL (1965) Social structure and organizations. In March JG (ed) Handbook of organizations. RandMcNally, Chicago

    Google Scholar 

  • Vahlne JE, Johanson J (2013) The Uppsala model on evolution of the multinational business enterprise-from internalization to coordination of networks. Int Mark Rev 30(3):189–210

    Article  Google Scholar 

  • Vahlne JE, Schweizer R, Johanson J (2012) Overcoming the liability of outsidership—the challenge of HQ of the global firm. J Int Manag 18(3):224–232

    Article  Google Scholar 

  • Zaheer S (1995) Overcoming the liability of foreignness. Acad Manag J 38(2):341–363

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Economics and Management, University of Florence, Florence, Italy

    Simone Guercini & Matilde Milanesi

Authors
  1. Simone Guercini
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Matilde Milanesi
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Simone Guercini .

Editor information

Editors and Affiliations

  1. Department of Economics and Management, University of Florence, Florence, Italy

    Simone Guercini

  2. Department of Economics and Management, University of Florence, Florence, Italy

    Gabi Dei Ottati

  3. School of Social Sciences, The University of Western Australia School of Social Sciences, CRAWLEY, West Australia, Australia

    Loretta Baldassar

  4. Faculty of Information Technology, Monash University, Caulfield East, Victoria, Australia

    Graeme Johanson

Rights and permissions

Reprints and permissions

Copyright information

© 2017 Springer International Publishing Switzerland

About this chapter

Cite this chapter

Guercini, S., Milanesi, M. (2017). Liabilities of Foreignness and Outsidership in the Evolution of Immigrant Chinese Entrepreneurship. In: Guercini, S., Dei Ottati, G., Baldassar, L., Johanson, G. (eds) Native and Immigrant Entrepreneurship . Springer, Cham. https://doi.org/10.1007/978-3-319-44111-5_8

Download citation

Publish with us

Policies and ethics

Search

Navigation