Overseas Business Knowledge Transfer and Firm Performance: the Role of Institutional Conditions

Adopting institutional theory, we examine the moderating effects of institutional factors on the relationship between the overseas business knowledge transferred by returnee entrepreneurs and their venture performance. The findings show that informal institutional differences between the home and host countries strengthen the positive impact of overseas business knowledge on the performance of returnee-founded firms. There is a complementarity between informal institutional differences and local government policy support which jointly enhance the positive impact of overseas business knowledge, whereas a well-developed local business infrastructure substitutes for the impact of variations in informal institutions on the relationship between overseas business knowledge and returnee venture performance.