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1 – 10 of over 1000
Article
Publication date: 21 September 2015

Samuel Ato Dadzie and Richard Afriyie Owusu

The purpose of this paper is to analyse the foreign direct investment (FDI) strategies of manufacturing firms in Ghana using the eclectic model in order to understand how…

Abstract

Purpose

The purpose of this paper is to analyse the foreign direct investment (FDI) strategies of manufacturing firms in Ghana using the eclectic model in order to understand how ownership, location and internalization factors impact FDI to developing countries like Ghana.

Design/methodology/approach

The authors use a quantitative methodology in order to statistically explore the relationships between dependent and independent variables. The data comes from a sample of 75 multinational enterprises that invested in the manufacturing sector between 1994 and 2008.

Findings

The results reveal that large firm size, extensive international experience and large market size lead to the choice of acquisition mode of entry, while high cultural distance, high country risk, high proprietary assets and incentives lead to the choice of greenfield mode in the context of Ghana.

Research limitations/implications

The results imply that the different economic, business and legal (locational) conditions of developing countries create different FDI strategies and paths of companies compared to developed markets.

Practical implications

Policy makers in developing countries should make efforts to improve market size, the institutional and regulatory environment, as well as the availability of human capital in order to attract FDI.

Originality/value

FDI studies have mainly analysed establishment mode strategies of firms in advanced markets. There is an increasing amount of research on FDI in emerging markets but very little on developing countries and African markets. Therefore, this study enables the authors to develop implications for existing theory and generate practical implications for firms and policy makers related to African and developing country markets.

Details

International Journal of Emerging Markets, vol. 10 no. 4
Type: Research Article
ISSN: 1746-8809

Keywords

Abstract

Details

Internationalization of Firms: The Role of Institutional Distance on Location and Entry mode
Type: Book
ISBN: 978-1-78714-134-6

Article
Publication date: 1 May 2008

Diego Quer and Enrique Claver

Nowadays, China is one of the most important destinations for international expansion of firms from all over the world. Based on the traditional theory on foreign direct…

Abstract

Nowadays, China is one of the most important destinations for international expansion of firms from all over the world. Based on the traditional theory on foreign direct investment and the resource‐based view of the firm, this paper analyzes the influence of various tangible and intangible firm‐specific factors on the choice amongst three different modes of entry into China: representative office, joint venture and wholly‐owned subsidiary. The results obtained suggest that the size of the investing firm, its performance as well as its experience regarding the country have a positive influence on the choice of types of foreign direct investment that involve a high level of resources commitment. In addition, the specific aim of the project affects these relationships.

Details

Journal of Asia Business Studies, vol. 2 no. 2
Type: Research Article
ISSN: 1558-7894

Keywords

Article
Publication date: 11 April 2016

Junzhe Ji, Pavlos Dimitratos and Qingan Huang

The purpose of this paper is to examine international decision making, information processing, and related performance implications. The authors aim to explore the…

1633

Abstract

Purpose

The purpose of this paper is to examine international decision making, information processing, and related performance implications. The authors aim to explore the relationship between international decision making and problem-solving dissensions related to entry mode decisions. In addition, they aim to investigate the effects of dissension on entry mode performance, and the moderating effect of the foreign direct investment (FDI) vs non-FDI decision as it relates to dissension-mode performance. Despite their significance from an information processing perspective, these issues have not been sufficiently explored in international entry mode research.

Design/methodology/approach

This research presents data collected from 233 privately owned internationalized Chinese firms. The analysis in this investigation includes hierarchical ordinary least squares regression.

Findings

The findings suggest an inverse U-shaped relationship between dissension and entry mode performance, as opposed to a linear one, and a moderating effect of FDI vs non-FDI decisions on this curvilinear dissension-performance association. These findings support and refine the rationale of the information processing perspective.

Originality/value

These findings add realistic elements to the alleged “rational” international decision-making doctrine assumed in previous entry mode literature. The findings show the importance of the heterogeneity of information processing in entry mode strategic decision-making processes (SDMPs), and its effects on specific decision types. The authors believe that this is the first empirical study to use an information processing perspective to examine the effects of SDMPs on entry mode performance.

Article
Publication date: 17 July 2017

Xie Qunyong

Since joint venture experience obtained from inward FDI may create a positive or negative impact on ownership mode choice, it is difficult to predict its direct impact…

Abstract

Purpose

Since joint venture experience obtained from inward FDI may create a positive or negative impact on ownership mode choice, it is difficult to predict its direct impact. The purpose of this paper is to combine the organizational learning and agency perspectives to find whether CEO power can moderate the effect of inward joint venture experience.

Design/methodology/approach

Using a sample of 337 foreign entries conducted by 77 Chinese firms during 1998-2008, this study has tested some interaction effects of inward joint venture experience and CEO power measures.

Findings

The author finds that inward joint venture experience interacts with CEO ownership and CEO duality, respectively, to have a negative impact on the selection of high-equity mode.

Originality/value

This study contributes to entry mode literature by finding that inward (but not merely outward) FDI experience can influence entry mode choices and by combining agency theory and the organizational learning perspective to solve the theoretical conflicts created by the two opposite effects of a FDI experience.

Details

International Journal of Emerging Markets, vol. 12 no. 3
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 1 April 2003

Georgios I. Zekos

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination…

65118

Abstract

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some legal aspects concerning MNEs, cyberspace and e‐commerce as the means of expression of the digital economy. The whole effort of the author is focused on the examination of various aspects of MNEs and their impact upon globalisation and vice versa and how and if we are moving towards a global digital economy.

Details

Managerial Law, vol. 45 no. 1/2
Type: Research Article
ISSN: 0309-0558

Keywords

Abstract

Details

Internationalization of Firms: The Role of Institutional Distance on Location and Entry mode
Type: Book
ISBN: 978-1-78714-134-6

Article
Publication date: 1 March 1997

Edward R. Bruning, Harry J. Turtle and Kevin Buhr

We examine the entry mode choice for Canadian firms entering the United States (U.S.). Entry options are categorized into three competing modes: mergers and acquisitions;…

Abstract

We examine the entry mode choice for Canadian firms entering the United States (U.S.). Entry options are categorized into three competing modes: mergers and acquisitions; joint ventures; and subsidiaries. The unit of analysis is the foreign direct investment (FDI) transaction between a Canadian firm and an American counterpart during the period from January 1980 through December 1989. Using canonical discriminant analysis, we develop a set of variables that characterize the entry mode choice. We find transaction specific information available to senior management provides important information regarding the entry mode choice. The importance of mergers and acquisitions is particularly apparent over this sample period. Empirical evidence strongly supports our measures of resource commitment, dissemination risk, and liquidity position as important measures determining mode of entry. Joint ventures display meaningful differences related to these measures in contrast to both mergers and acquisitions, and subsidiary investments.

Details

International Journal of Commerce and Management, vol. 7 no. 3/4
Type: Research Article
ISSN: 1056-9219

Article
Publication date: 1 June 1995

M. Krishna Erramilli and Derrick E. D′Souza

The strength of the relationship between uncertainty and the firm′sdecision to engage in foreign direct investment (FDI) is moderated byfactors such as capital intensity…

4411

Abstract

The strength of the relationship between uncertainty and the firm′s decision to engage in foreign direct investment (FDI) is moderated by factors such as capital intensity and firm size. Recognizes two types of uncertainty, internal and external. Develops specific hypotheses about how the influence of external uncertainty on FDI is conditioned by certain moderators. Not enough is known about how internal uncertainty affects the FDI to develop specific predictions about moderators. However, these effects are empirically determined. Uses data on US international service firms to test the various effects using logistic regression. Results suggest that the moderators affect both the strength and the direction of the impact that internal and external uncertainty have on foreign direct investment.

Details

International Marketing Review, vol. 12 no. 3
Type: Research Article
ISSN: 0265-1335

Keywords

Article
Publication date: 25 October 2018

Dongling Cai, Leonard Fengsheng Wang and Xiaokai Wu

The purpose of this study is to investigate the interplay between economic governance and privatization, and how these two instruments affect the entry mode choice of the…

Abstract

Purpose

The purpose of this study is to investigate the interplay between economic governance and privatization, and how these two instruments affect the entry mode choice of the foreign firm and the social welfare of the host country.

Design/methodology/approach

This study constructs a mixed duopoly model wherein one domestic public firm competes with a foreign firm and investigates the influence of economic governance investment on the domestic government’s optimal degree of privatization choice and the foreign firm’s entry mode choice.

Findings

This study shows that (1) better economic governance enhances the effect of privatization on output, thus resulting in a lower degree of privatization; (2) the optimal privatization policy of the domestic government is partial privatization irrespective of the foreign firm’s entry mode choice; (3) with optimal investment by the domestic government on economic governance, the optimal degree of privatization is higher under FDI than export, and the host-country welfare is also higher under FDI. In particular, this study demonstrates that better economic governance decreases the threshold of the degree of privatization when the foreign firm switches from export to FDI, implying that better economic governance stimulates the foreign firm to undertake FDI in the host country.

Practical implications

The findings shed some light on both the mixed ownership reform of the SOEs in China and attracting foreign capital inflow to improve the host country’s social welfare.

Originality/value

To the best of the authors’ knowledge, this study constitutes the first attempt to build a theoretical framework to explore how the interactions between economic governance and privatization influence the entry mode choice of the foreign firm.

Details

Nankai Business Review International, vol. 9 no. 4
Type: Research Article
ISSN: 2040-8749

Keywords

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