| Organizational slack, entrepreneurial orientation, and corporate political activity |
Received:October 12, 2017 Revised:October 12, 2017 |
Key Words: financial slack; operation slack; EO; CPA; the behavior theory |
| Author Name | Affiliation | | yanyan li* | Xi'an Jiaotong University | | Shanxing Gao | Xi'an Jiaotong University | | Yu Gao | Xi'an Jiaotong University |
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Abstract: |
| Corporate political activity, a kind of nonmarket strategy, shows beneficial effect on firm performance. However, the mechanism of promote firms engage in CPA remains obscure. The behavior theory argued that firm’s will and ability are important antecedents to engage in CPA. How can a firm develop ability and will to engage in CPA? To solve these research question, this research develop a mediation model contains organization slack, entrepreneurial orientation and CPA. This research investigate the effect of different types of slack, as well as the mediation effect of different dimensions of EO. This research employs empirical data from 303 firms in China and uses linear regression and PROCESS techniques to reveal interesting findings. First, the results support the key argument that EO plays mediation effect between slack and CPA. Second, financial slack provides stronger support to develop certain capabilities than operational slack. Third, sub-dimension of EO plays heterogeneous mediation effect according to their different emphasis. This research extends the behavior theory by integrate slack and EO as the ability and will to interpret firm’s engagement in CPA. Moreover, this research investigate the mechanism of promoting CPA, which offer managerial implications to managers. This research also probe the strategy decision process role of EO, which extend the strategy research. |
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