Relations between multinational firms and host governments: the experience of American-owned firms in China

Abstract

A survey of managers of American firms in China indicates that they have been able to maintain good relationships with the Chinese government; this is particularly true for larger firms. Statistical results suggest that government interference in the operations of the subsidiary is generally minimal though it is greater in the case of joint ventures as compared to wholly owned firms. The performance of the subsidiary is influenced by the quality of the relationship with the host government. Implications for managers of foreign firms are discussed.