Once sued, twice shy: international litigation, trust radius, and international expansion

• 成果类型: Article
• 署名作者: Chen, Xuchang; Li, Han; Yao, Jingjing
• 署名单位: University of Reading; University of Nottingham Ningbo China; Universite de Lille; IESEG School of Management; Centre National de la Recherche Scientifique (CNRS)
• 刊物名称: JOURNAL OF INTERNATIONAL BUSINESS STUDIES
• ISSN/ISSBN: 0047-2506
• DOI: 10.1057/s41267-025-00832-9
• 发表日期: 2026
• 关键词: negative intergroup contact; IN-GROUP; BUSINESS; FIRMS; diversity; determinants; institutions; COOPERATION; performance; attitudes

摘要

The world is witnessing an increase in interorganizational conflicts across borders, yet their impact on firms' international expansion remains largely underexplored. Building on intergroup contact theory, we theorize that involvement in conflict with a foreign firm constitutes a form of negative intergroup contact, which can spill over into broader unfavorable attitudes-not only toward the specific foreign entity involved but also toward the foreign market more generally. Specifically, we predict that involvement in international litigation discourages a firm from undertaking international expansion. Furthermore, this negative spillover effect can be mitigated by trust radius-the width of the cooperation circle within a society. Firms embedded in regions with a wider trust radius and hence accustomed to interacting with diverse groups are less affected by international litigation. Results from a sample of Chinese publicly listed firms support our hypotheses. By testing and extending intergroup contact theory in international business research, we establish a theoretical link between interorganizational conflict and international expansion, and we also highlight trust radius as a key contributing factor to firms' intergroup contact dynamics. The article explores how international litigation affects firms' willingness to expand globally, particularly through foreign direct investment (FDI). As businesses increasingly enter global markets, they face conflicts due to cultural and regulatory differences. Recent geopolitical tensions have exacerbated these issues, leading to a rise in international business disputes. The study investigates whether involvement in litigation with foreign entities discourages firms from international expansion and how this negative impact might be mitigated. The key finding is that international litigation can indeed discourage firms from expanding internationally, but this effect can be mitigated by a wider trust radius-the extent to which a society's cooperative norms include both ingroup and outgroup members. This article uses data from 3671 publicly listed Chinese firms from 2001 to 2018 to examine the impact of international litigation on FDI. The study employs intergroup contact theory, which suggests that contact with members of different social groups can shape attitudes and behaviors. International litigation is viewed as a negative intergroup contact experience, potentially leading to negative attitudes toward foreign entities. The study also introduces the concept of trust radius, which refers to the width of the social circle within which people are willing to cooperate. A wider trust radius can mitigate the negative effects of international litigation on international expansion. The research uses a variety of data sources, including litigation records, social surveys, and firm-level financial data, to analyze these relationships. The results show that firms involved in international litigation are less likely to engage in outward FDI. However, this negative effect is moderated by the trust radius; firms in regions with a wider trust radius are less affected by international litigation. The study concludes that while international litigation can discourage firms from expanding globally, fostering a broader trust radius can help mitigate this effect. This research contributes to the understanding of how negative intergroup contact experiences influence firms' internationalization strategies and highlights the importance of social trust in international business. Future implications include the potential for firms to focus on building broader cooperative norms to support international expansion despite legal conflicts.This text was initially drafted using artificial intelligence, then reviewed by the author(s) to ensure accuracy. Le monde est t & eacute;moin d'une augmentation des conflits inter-organisationnels & agrave; travers les fronti & egrave;res, mais leur impact sur l'expansion internationale des entreprises reste largement inexplor & eacute;. Nous appuyant sur la th & eacute;orie du contact intergroupe, nous th & eacute;orisons que l'implication dans un conflit avec une entreprise & eacute;trang & egrave;re constitue une forme de contact intergroupe n & eacute;gatif, qui peut se r & eacute;percuter sur des attitudes d & eacute;favorables plus larges - non seulement envers l'entit & eacute; & eacute;trang & egrave;re sp & eacute;cifique impliqu & eacute;e, mais aussi envers le march & eacute; & eacute;tranger de mani & egrave;re plus g & eacute;n & eacute;rale. Plus pr & eacute;cis & eacute;ment, nous pr & eacute;disons que l'implication dans des litiges internationaux d & eacute;courage une entreprise d'entreprendre une expansion internationale. De plus, cet effet n & eacute;gatif de d & eacute;bordement peut & ecirc;tre att & eacute;nu & eacute; par le rayon de confiance - c'est-& agrave;-dire l'& eacute;tendue du cercle de coop & eacute;ration au sein d'une soci & eacute;t & eacute;. Les entreprises implant & eacute;es dans des r & eacute;gions avec un rayon de confiance plus large, et donc habitu & eacute;es & agrave; interagir avec des groupes divers, sont moins affect & eacute;es par les litiges internationaux. Les r & eacute;sultats d'un & eacute;chantillon d'entreprises chinoises cot & eacute;es en bourse confirment nos hypoth & egrave;ses. En testant et en & eacute;largissant la th & eacute;orie du contact intergroupe dans la recherche en affaires internationales, nous & eacute;tablissons un lien th & eacute;orique entre les conflits inter-organisationnels et l'expansion internationale. Nous mettons & eacute;galement en & eacute;vidence le rayon de confiance comme un facteur cl & eacute; contribuant & agrave; la dynamique des contacts intergroupes des entreprises. El mundo est & aacute; presenciando un aumento en los conflictos interorganizacionales transfronterizos, pero su impacto en la expansi & oacute;n internacional de las empresas permanece en gran medida inexplorado. Bas & aacute;ndonos en la teor & iacute;a del contacto intergrupal, teorizamos que la participaci & oacute;n en un conflicto con una empresa extranjera constituye una forma de contacto intergrupal negativo, lo cual puede derivar en actitudes desfavorables m & aacute;s amplias, no solo hacia la entidad extranjera espec & iacute;fica involucrada, sino tambi & eacute;n hacia el mercado extranjero en general. Espec & iacute;ficamente, predecimos que la participaci & oacute;n en litigios internacionales desalienta a una empresa de emprender una expansi & oacute;n internacional. Adem & aacute;s, este efecto de derrame negativo puede ser mitigado por el radio de confianza, es decir, la amplitud del c & iacute;rculo de cooperaci & oacute;n dentro de una sociedad. Las empresas ubicadas en regiones con un radio de confianza m & aacute;s amplio, y por lo tanto acostumbradas a interactuar con grupos diversos, se ven menos afectadas por los litigios internacionales. Los resultados de una muestra de empresas chinas que cotizan en bolsa respaldan nuestras hip & oacute;tesis. Al probar y extender la teor & iacute;a del contacto intergrupal en la investigaci & oacute;n de negocios internacionales, establecemos un v & iacute;nculo te & oacute;rico entre el conflicto interorganizacional y la expansi & oacute;n internacional, y tambi & eacute;n destacamos el radio de confianza como un factor clave que contribuye a las din & aacute;micas de contacto intergrupal de las empresas. O mundo est & aacute; testemunhando um aumento nos conflitos interorganizacionais al & eacute;m-fronteiras, mas o impacto desses conflitos na expans & atilde;o internacional de empresas permanece amplamente inexplorado. Com base na teoria do contato intergrupal, teorizamos que o envolvimento em conflitos com uma empresa estrangeira constitui uma forma de contato intergrupal negativo, que pode se espalhar para atitudes desfavor & aacute;veis mais amplas - n & atilde;o apenas em rela & ccedil;& atilde;o & agrave; entidade estrangeira envolvida, mas tamb & eacute;m ao mercado estrangeiro de forma mais ampla. Especificamente, prevemos que o envolvimento em lit & iacute;gios internacionais desencoraja uma empresa de empreender a expans & atilde;o internacional. Al & eacute;m disso, esse efeito negativo de transbordamento pode ser mitigado pelo raio de confian & ccedil;a - a amplitude do c & iacute;rculo de coopera & ccedil;& atilde;o dentro de uma sociedade. Empresas inseridas em regi & otilde;es com um raio de confian & ccedil;a mais amplo e, portanto, habituadas a interagir com grupos diversos, s & atilde;o menos afetadas por lit & iacute;gios internacionais. Resultados de uma amostra de empresas chinesas de capital aberto apoiam nossas hip & oacute;teses. Ao testar e expandir a teoria do contato intergrupal na pesquisa em neg & oacute;cios internacionais, estabelecemos uma conex & atilde;o te & oacute;rica entre conflito interorganizacional e expans & atilde;o internacional, e tamb & eacute;m destacamos o raio de confian & ccedil;a como um fator-chave que contribui para din & acirc;micas de contato intergrupal das empresas. (sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic),(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic).(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)--(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic).(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic).(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)((sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic))(sic)(sic)(sic).(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic).(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic).(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic),(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic)(sic).