How institutional voids influence Brazilian foreign direct investment in Angola

Authors

  • Renato Virches Centro Universitário FEI, FEI/SP, Brazil
  • Fernanda Ribeiro Cahen Centro Universitário FEI, FEI/SP, Brazil

DOI:

https://doi.org/10.18568/1980-4865.12133-47

Keywords:

Brazilian FDI, Africa, Multinationals from emerging markets, Institutional voids

Abstract

How do institutional voids influence emerging market multinationals (EMNEs) foreign direct investment (FDI) in developing countries? In this article we respond to this question by examining Brazilian FDI in Angola as our analytical setting. We focus on the host country’s institutions and its institutional voids as essential factors that attract the FDI of EMNES to developing countries. The research indicates that Brazilian companies fill in much of these voids within the market intermediaries, often creating a point of competitive advantage, and also creating advantages in relation to FDI from other economies that invest in Angola. The scarce literature on FDI in Africa has been largely dedicated to the analysis of Chinese investment in the region. We aim to complement recent research on the influence of the host country’s institutions on the behavior of FDI in developing countries, explaining how some EMNEs are able to use the institutional voids of developing countries as market opportunities. Our findings should provide also implications for EMNEs managers from other emerging markets by providing a better understanding of how Brazilian multinationals expand their business in less developed countries, handle institutional voids and manage relationships with local and foreign institutions in the host country.

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Author Biographies

Renato Virches, Centro Universitário FEI, FEI/SP, Brazil

holds a Master in Business Administration from FEI, a MBA in Marketing from ESPM and two MBAs in Business Administration from FIA and FGV. He has 20 years of experience in consulting market investment and credit analysis and 10 years of teaching experience in the areas of market administration, business and innovation. He is currently CEO of Correct Data, a company of creation and development of credit information systems and services and he is a lecturer at Universidade Paulista. E-mail: rsvirches@uol.com.br

Fernanda Ribeiro Cahen, Centro Universitário FEI, FEI/SP, Brazil

Assistant professor of Management at Centro Universitário FEI. She was a post-doctoral fellow in International Business at Kelley School of Business at Indiana University in 2012–2013. She received her PhD in Business Administration in 2012 from University of Sao Paulo.E-mail: fribeiro@fei.edu.br

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Published

2017-04-01

How to Cite

Virches, R., & Cahen, F. R. (2017). How institutional voids influence Brazilian foreign direct investment in Angola. Internext - International Business and Management Review, 12(1), 33–47. https://doi.org/10.18568/1980-4865.12133-47