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INTRODUCTION
Multinational enterprises (MNEs) operating in emerging markets must gain local marketing channels to stay close to their customers (Griffith, Chandra, & Fealey, 2005). This necessitates remolding their channel strategies by building relational ties and convergence with local markets to draw upon local knowledge and relationships (Luo, 2007). Therefore, as veteran MNEs evolve beyond mere "foreign investors" to become "strategic insiders", they may have to migrate away from confrontation (e.g., tension with host markets resulting from MNEs' poor marketing behavior and inadequate attention paid to social factors) to build cooperation with local distributors (Danskin, Dibrell, & Kedia, 2005), so as to transform from production relocation to value chain localization (e.g., to work directly with local wholesalers or sell directly to retailers to enhance channel effectiveness), and from competence transfer to competence building (e.g., to develop new capabilities through local learning and adaptation) (Luo, 2007). Such channel cooperation, according to Mohr and Spekman (1994), rests firmly upon MNEs' collaborative communication behavior with their local channel partners. Alternatively, MNEs must maintain frequent, bidirectional, formal, and noncoercive communications with their local distributors to create mutual support and volitional compliance (Mohr & Nevin, 1990).
However, managing channel relationships in emerging markets characterized by high uncertainty may demand more than formal interfirm communications to achieve coordinated channel activities and outcomes (Mohr & Nevin, 1990). As Grewal and Dharwadkar (2002) argue, marketers aspiring to improved channel performance should consider not only economic appropriateness but also social fitness such as social legitimacy and recognitions that span cultures. Thus, whereas marketers may use formal communications to develop interfirm relationships, emerging markets in collectivist cultures often require MNEs to employ interpersonal communications to cultivate embedded channel relationships (Luo, 2002). For instance, Chinese channel dyads often resolve conflict through guanxi (i.e., interpersonal connections, friends' mediation, or the influence of friends of friends) to gain harmony. In such contexts, channel communication designed to manage channel relationships (Mohr & Nevin, 1990) serves not only as an interfirm influence (cf. Frazier & Summers, 1986) but also as an informal process to transmit private information (Burt, 1992), determine informal governance arrangements (Uzzi, 1997), build interpersonal friendship and trust (Nicholson, Compeau, & Sethi, 2001), and reduce transaction uncertainty and costs (Uzzi & Lancaster, 2003), through networks of social relations...