Using Organization Structure to Buffer Political Ties in Emerging Markets : A Case Study

We contend that business groups in emerging economies command a premium when it comes to benefiting from political ties because their organizational structures are compartmentalized and thereby well suited to profitably include, isolate and mask political ties. We demonstrate how the structural design of a business group and its political ties are mutually reinforcing. A case study of the Indonesian Salim business group during and immediately after the Suharto regime (1967-1998) supports the argument that organizational structuring belongs to the repertory of political strategies used to manage dependence on government