Responding to the multi-faceted liabilities of origin for emerging market MNEs: a cognitive institutional entrepreneurship perspective

Liabilities of Origin (LORs) are a unique challenge for Emerging Market Multinational Enterprises (EMNEs) in internationalisation especially in the advanced markets. In this study, we ask research questions: what types of stereotypes from the host country stakeholders may contribute to EMNEs' LORs, and how do EMNEs change these stereotypes over time? We conduct a case study on Chinese telecom Huawei and examine its entries in European and US markets. Our findings show three types of country-of-origin stereotypes: capability-, ethics- and government and enterprise relationship-based stereotypes contribute to LORs. We also find that EMNEs adopt three cognitive institutional entrepreneurship strategies: differentiation, replacement and complementation to address these stereotypes. Our study provides a more fine-grained understanding of the relationship between stereotypes and LORs, and provides a new perspective for EMNEs to mitigate multi-faceted LORs. We also contribute to institutional entrepreneurship research by discussing it at cognitive level.