Understanding the uniqueness of emerging markets and their firms: institutional voids-based dynamic capabilities in the Chinese automotive sector

IB scholars are interested in understanding the uniqueness of emerging markets and their firms and argue that firms operating in environments characterized by institutional voids are likely to face higher costs due to reduced information flows and limited market intermediaries. We argue that institutional voids drive the dynamic capabilities of emerging market multinational enterprises. Taking the Chinese auto industry as an example, this article integrates institutional voids and dynamic capabilities to provide insight into how Chinese EMNEs have moved from technology followers to technology leaders to integrate, build, and reconfigure internal and external competencies and address a rapidly changing environment.