The Reputation-Investment Paradox in Cross-Border Infrastructure Development: Reconceptualizing the Role of Public Opinion in State-Led International Business Initiatives
Author (s)
Long Justin Chang
Abstract
This paper discusses the reputation-investment paradox observed in China’s Belt and Road Initiative, where sustained investment expansion succeeds despite intensifying international criticism. Conventional international business theory predicts that negative public opinion, political risk accumulation, and soft power deficits constrain cross-border investment flows. Yet China’s outward foreign direct investment has been growing steadily with Belt and Road Initiative participation expanding continuously. This paradox challenges established assumptions regarding reputation’s role in internationalization success. Through a conceptual problematization, analysis, and discussion, this paper identifies three mechanisms that enable state-led initiatives to achieve insulation from reputational pressures: Bilateral government agreements that supersede public opinion, financial incentives that mediate reputational concerns in capital-scarce economies, and non-democratic governance structures reduce sensitivity to external criticism. These mechanisms operate contingently, moderated by project scale, institutional distance, and alternative legitimacy sources. The resulting logic distinguishes reputation-sensitive from reputation-insulated modes of internationalization, and shows that governance system differences enable fundamentally distinct strategic logics in cross-border business activity. This contribution advances international business scholarship by theorizing conditions under which reputation-investment relationships function contingently rather than universally, with implications for understanding state-led infrastructure initiatives, sovereign wealth fund investments, and state-owned enterprise internationalization in an increasingly multipolar global economy.
Keywords: Belt and Road Initiative (BRI), Reputation, State-led internationalization, Cross-border investment, China.
| Title: | The Reputation-Investment Paradox in Cross-Border Infrastructure Development: Reconceptualizing the Role of Public Opinion in State-Led International Business Initiatives |
|---|---|
| Author: | Long Justin Chang |
| Journal Name: | International Journal of Science and Business |
| Website: | ijsab.com |
| ISSN: | ISSN 2520-4750 (Online), ISSN 2521-3040 (Print) |
| DOI: | https://doi.org/10.58970/IJSB.2715 |
| Media: | Online |
| Volume: | 54 |
| Issue: | 1 |
| Issue publication (Year): | 2026 |
| Acceptance Date: | 22/08/2026 |
| Date of Publication: | 28/08/2026 |
| PDF URL: | http://ijsab.com/wp-content/uploads/2715.pdf |
| Free download: | Available |
| Page: | 1-15 |
| First Page: | 1 |
| Last Page: | 15 |
| Paper Type: | Conceptual Paper |
| Current Status: | Published |
Cite This Article:
Chang, L. J. (2026). The Reputation-Investment Paradox in Cross-Border Infrastructure Development: Reconceptualizing the Role of Public Opinion in State-Led International Business Initiatives, International Journal of Science and Business, 54(1), 1-15. https://doi.org/10.58970/IJSB.2715
About Author (s)
Long Justin Chang , University of Minnesota, Humphrey School of Public Affairs, Minneapolis, Minnesota, United States. ORCID: https://orcid.org/0009-0008-8849-0337
DOI: https://doi.org/10.58970/IJSB.2715
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