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Balancing formality and informality in business exchanges as a duality: a comparative case study of returnee and local entrepreneurs in China

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journal contribution
posted on 05.08.2015, 13:44 by Daomi Lin, Jiangyong Lu, Peter Ping Li, Xiaohui Liu
The management paradigms in the West mainly rely on legal contracts and explicit rules (formality), while the management traditions in the East emphasize social relationships and implicit norms (informality). In an era of ‘West-meets-East’, balancing formality and informality is becoming critical for firms, especially those facing institutional differences in transnational contexts and institutional transitions. In this study, we conducted a comparative multi-case study on returnee entrepreneurs and local entrepreneurs in China. We found that at the early stage of venturing returnee entrepreneurs emphasized formality more than informality, while local entrepreneurs stressed informality more than formality. However, the formality-informality balance among both returnee and local entrepreneurs converged over time in line with the institutional transition in China. Returnee entrepreneurs increased the emphasis on informality (but kept the dominant position of formality), whereas local entrepreneurs gradually shifted from informality to formality. The spatial pattern of asymmetrical balancing and the temporal pattern of transitional balancing are both rooted in the Chinese philosophy of Yin-Yang balancing.

History

School

  • Business and Economics

Department

  • Business

Published in

Management and Organization Review

Volume

11

Issue

2

Pages

315 - 342

Citation

LIN, D. ... et al, 2015. Balancing formality and informality in business exchanges as a duality: a comparative case study of returnee and local entrepreneurs in China. Management and Organization Review, 11 (2), pp.315-342.

Publisher

Cambridge University Press (© The International Association for Chinese Management Research)

Version

AM (Accepted Manuscript)

Publisher statement

This work is made available according to the conditions of the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0) licence. Full details of this licence are available at: https://creativecommons.org/licenses/by-nc-nd/4.0/

Publication date

2015-06-05

Copyright date

2015

Notes

This paper was accepted for publication in the journal Management and Organization Review [Cambridge University Press / © The International Association for Chinese Management Research] and the definitive published version is available online at: http://dx.doi.org/10.1017/mor.2014.2

ISSN

1740-8776

eISSN

1740-8784

Language

en