Adaptation of Compensation Practice in China: The Role of Sub-National Institutions

Wei Lu, Ayse Saka-Helmhout, Rebecca Piekkari

Research output: Contribution to journalArticleScientificpeer-review

12 Citations (Scopus)
324 Downloads (Pure)


Unlike previous research that has largely focused on the influence of national institutions on human resource management practices in China, our study taps into the role of sub-national institutions. We demonstrate, via a qualitative configurational analysis, that foreign subsidiaries of multinational corporations still adapt HQ compensation practice to the local context despite low regulatory pressure and low mobility of skills at the sub-national level. This adaptation is facilitated by a decentralized structure in the multinational corporation. Our study also shows that high regulatory pressure and high portability of skills at the sub-national level alone are sufficient to induce local adaptation of compensation practice. Our explanation points to the significant role played by sub-national institutions in large and rapidly changing emerging economies and contributes to research on local adaptation of HRM practice in China. It offers an insight into forms of institutional agency by political and economic actors at local levels of governance as they attempt to influence the skills and human resources available for MNCs through regulatory means.
Original languageEnglish
Pages (from-to)235-267
Number of pages33
JournalManagement and Organization Review
Issue number2
Early online date31 May 2019
Publication statusPublished - 1 Jun 2019
MoE publication typeA1 Journal article-refereed


  • adaptation of compensation practice
  • China
  • MNC decentralization
  • Qualitative Comparative Analysis (QCA)
  • sub-national institutions
  • 地方制度
  • 中国
  • 薪酬实践的适应性
  • 定性比较分析(QCA)
  • 跨国公司分权
  • адаптация методов компенсации
  • Китай
  • децентрализация многонациональных корпораций
  • качественный сравнительный анализ
  • субнациональные учреждения
  • adaptación de la práctica de compensación
  • descentralización de empresas multinacionales
  • análisis cualitativo comparado
  • instituciones subnacionales


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