Do Strategic Motives Affect Ownership Mode of Foreign Direct Investments (FDIs) in Emerging African Markets? Evidence from Ghana

Increased tradability of services, made possible by the information and communications technology (ICT) revolution, has been at the heart of the internationalization of services. Although rapid growth of the services trade between parents of multinational enterprises (MNEs) and their overseas subsidiaries has contributed to the internationalization of services, empirical studies examining the determinants of intra‐MNE trade in services are few. This article, using the ownership, location, and internalization (OLI) framework, attempts to explain intra‐MNE trade in services. The results provide strong support for the OLI perspective, and posit a complementary relationship between manufacturing foreign direct investment and intra‐MNE services trade. The results also suggest the importance of subsidiaries' absorptive capacity and breadth of global connectedness for intra‐MNE trade.

Section: Oli Frameworkmentioning

confidence: 99%

Internationalization of services: The case of intra‐multinational enterprise trade

Rao

Vinod

2019

“…Our systematic review revealed four studies on the reasons that foreign firms enter Africa through IJVs (Boateng & Glaister, 2003;Dadzie et al, 2018;Luiz & Charalambous, 2009;Odediran & Windapo, 2017).…”

Section: Ijv Entry Decisions and Entry Motives Into Africamentioning

confidence: 99%

“…Thus, we propose the following: Strategic assets are concentrated in the developed economies (Makino, Lau, & Yeh, 2002). For this reason, we will continue to see IJVs with market-seeking and efficiency-seeking motives in Africa (Dadzie et al, 2018). While foreign partners will continue to pursue these motives, local partners will continue their efforts to acquire technological skills and management expertise from foreign partners.…”

Section: Propositionsmentioning

confidence: 99%

“…This could be a result of the nature of the themes explored. Eight studies (36%) used IB theories, such as social capital theory (Ado et al, 2017), the OLI paradigm (Dadzie et al, 2014; Dadzie et al, 2018), institutional theory (Hearn, 2015; Luiz & Charalambous, 2009), resource dependency and structural contingency theory (Hearn, 2015), organizational culture and national culture theories (Gómez‐Miranda et al, 2015; Kivrak et al, 2014), and the resource‐based view and Porter’s competitive strategy (Acquaah, 2009).…”

Section: What Are the Characteristics Of Ijv Research In Africa?mentioning

confidence: 99%

“…The increasing foreign direct investment (FDI) inflows into several African countries are the result of market reforms and economic liberalization policies implemented over the past three decades (Bartels, Napolitano, & Tissi, 2014; Dadzie, Owusu, Amoako, & Aklamanu, 2018; Degbey & Ellis, 2017; World Bank, 2011, 2012). While the total value of acquisitions in Africa is twice that of the previous decade (UNCTAD, 2015), the use of the greenfield alternative entry mode has also risen because of the rapidly improving formal institutions in many African countries (R. Chen, Cui, Li, & Rolfe, 2017).…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

International joint ventures research on Africa: A systematic literature review, propositions, and contextualization

Oguji

Degbey

Owusu

2018

This study reviewed the research on international joint ventures (IJVs) in Africa up to 2017. The authors performed a systematic search of peer-reviewed good-quality research using the 6W procedure and ensured the quality of the review by using the 5Cs quality criteria. The content analysis was focused on four research questions. A total of 22 relevant studies were found. Overall, only about one-third of the lead authors were affiliated with African universities. A majority of the studies were quantitative, and 78% of the studies were done for three countries: Ghana, Morocco, and Nigeria. There was either just one or no study on trust and conflict, partner selection, and human resource management (HRM). At the contextual level, it seems the most important factor influencing IJV strategy and success is institutions. We therefore suggest a greater use of institutional theory. Finally, we present a summary of conceptual framework and four propositions to guide future research.

Market entry into Africa: Acquisitions and international joint ventures. Studies of foreign firms' market entry strategies, challenges, and performance in Africa

Oguji

Owusu

2020

While the interest in investing in Africa is rising, the know‐how of business on the continent is very limited. There have been only recently few special issues focusing on sub‐Saharan Africa in the top international business journals: “Sub‐Saharan Africa at a key inflection point” (Thunderbird International Business Review 2009); “Contemporary developments in the management of human resources in Africa” (Journal of World Business 2011); “Contemporary challenges and opportunities of doing business in Africa” (Journal of Technological Forecasting and Social Change 2016); “Critical perspectives on international business in Africa (Critical Perspectives on International Business 2016); “Strategic Management in Africa (Global Strategy Journal, 2017); and “The internationalization of African firms (Thunderbird International Business Review 2016). The aim of this special issue is to advance understanding of international business in Africa and specifically focus on how foreign firms enter African markets via acquisitions and international joint ventures and extend knowledge of these market entry strategies and performance in Africa for research and for foreign firms intending to, or currently doing business in Africa. This guest editorial provides a summary of the five articles and one book review in this special issue categorized into three broad thematic issues: International joint ventures and acquisitions as market entry strategies in Africa; cross‐border investments of African firms; and theoretical underpinnings.