Social ties, as informal institutions, contribute to firms' performance in emerging economies. Formal market-supporting institutions in emerging economies are in general less developed, social ties cultivated by entrepreneurs thus serve as substitutes for formal institutional support. However,...

This study examines whether firms’ financial fraudulent behavior varies when local firms are led by nonlocal CEOs. Building on the social identity theory, we argue that nonlocal CEOs, due to their different location-based social identities, are perceived as outgroup leaders and face intergroup...