When senior managers think about how to respond to the threats and opportunities of technological change, they often dream of the same thing: If they just could start a new company or division that isn’t held back by conventional thinking or outdated business models. But what if they asked themselves instead how they might extract the real value of their technology assets? That’s what Axiata Group, a Malaysia-based telecommunications conglomerate that operates in emerging Asian economies and has annual revenues of $6 billion, did. It leveraged its network assets to help small businesses, including startups, launch over 90,000 services in Sri Lanka and Bangladesh that generated revenues of more than $100 million in 2021 for Axiata.
Founded in November 2014 and based in Shanghai, NIO designed, jointly manufactured, and sold premium “smart” EVs. Its mission was to “shape a joyful lifestyle by offering high-performance smart electric vehicles and being the best user enterprise. At NIO Day 2021, Founder William Li shared plans for the company to expand to 25 different countries and regions by 2025, including the automobile juggernaut nation of Germany. Would users in other markets and cultures embrace his user enterprise and high-touch model? NIO faced tough competition ahead in the race for EV supremacy.
How do state-business relations interact with outward investment in authoritarian regimes? This paper examines this question in the context of China’s rapid transformation into a major capital exporter. While most political economy scholarship focuses on firms’ economic profiles to discern preferences toward international openness, this paper shows the importance of domestic political status and specifically business’s vulnerability to the state in explaining the behavior of firms as they invest abroad and the state’s reaction. I present three types of domestic capital that differ in economic and political logic as they go abroad: tactical capital pursues political power and prestige, competitive capital pursues commercial goals, and crony capital seeks refuge from the state and asset expatriation. The Chinese regime’s approach to outward investment, which I characterize as mobilization campaigns adjusted over time and combined with targeted domestic regulation, endeavors to treat these different kinds of capital differently, deploying and disciplining tactical capital, enabling competitive capital, and constraining crony capital.
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