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Working paper

Как строятся отношения фирм с государственной властью в странах с разнородными процессами институциональной трансформации: финские фирмы на динамичных рынках России, Эстонии и Китая

Kosonen R., Кеттунен Е., Котилайнен Ю.
The paper analyses the relations of transnational companies with the state in their host countries. The focus is on foreign firms operating in the rapidly changing markets of former state socialist countries. In more detail, we investigate and compare the relations that Finnish companies have with the state in Russia, China, and Estonia. The three rapidly developing economies are challenging for foreign investors as they have considerably reorganized their formal institutional framework and the role of the public sector in business. Theoretically, our study contributes to the governance approach of institutional economics, especially to the discussion on formal and informal institutions in the organization of social relations of foreign companies, as well as relational economic geography. The study identifies the challenges and problems in the relations that foreign firms have with the state in the three host countries. Furthermore, we point out successful mechanisms of governance, i.e. the ways in which problems arising from the institutional context in the host country have been solved in the companies under investigation. Empirically, our analysis is based on a database of interviews with transnationalized Finnish companies that represent various company sizes and lines of business. The findings reveal similarities and differences in the governance mechanisms in terms of the three emerging economies. Drawing from evidence from the three economies with different processes of restructuring, the study points to the diverse roles of formal (e.g. rule-based) and informal (e.g. relationship-based) institutions in business. This paper results from the project “Companies’ Social Relations as a Component of Local Business Strategies: Innovative Integration Strategies of Finnish and Russian Companies”, funded by Academy of Finland (grant No. 118538) and Russian Foundation for Humanities (grant No.07-02-93203а/F).