Impact of Political Capital on Strategic Knowledge-Seeking ODI: The Case of Private Entrepreneurs in Zhejiang Sewing Machine Industry


Peter Buckley, University of Leeds


This study explores the impact of political capital on firms’ knowledge-seeking behaviour via making outward direct investment (ODI). This primary work is based on four Chinese leading private firms located in Taizhou sewing machine industrial district of Zhejiang province. Using longitudinal events, archive and interview data we construct firms’ complex and long-term connections with the government at local, provincial and national levels. The results suggest that strategic knowledge-seeking ODI decisions are impacted by three key factors: corporate entrepreneurial activities, political capital and competition contingencies. The preliminary findings lead to a set of tentative theoretical propositions for further large sample testing.


Dr Yue Tina Xu is currently a lecturer and the Programme Leader of MSc in International Business at the Centre for Regional and International Business (CRIB) of the Hull University Business School (UK).
Her research focuses on the debate of whether and how internationalisation theories can be applied to explain the competitive behaviours of Chinese firms in their outward direct investment (ODI) operations. Towards this argument, the originality/value of her research is that it provides a new theoretical treatment through integrating different theoretical perspectives based on entrepreneurship theory, contingency theory, resource-based theory, and the upper echelon theory.
A primary study based on the presented topic won the best conference paper on the Seventh International Symposium on Global Manufacturing and China (GMC) in September 2011. This presented paper completed with additional data to evidence the impact of political capital on knowledge-seeking ODI of Chinese private firms located in industrial district of the Zhe Jiang province.