Knowledge, Bargaining Power, and the Instability of International Joint Ventures

Institutional distance and knowledge acquisition in international buyer-supplier relationships: The moderating role of trust

“…From a competitive perspective, a loss of knowledge by the partner via asymmetrical learning could result in the creation of a new or stronger competitor (Inkpen, 2000;Tsang, 1999). In an empirical study examining the underlying reasons for the instability of international joint ventures, Inkpen and Beamish (1997) found that a joint venture would become less stable if one partner accumulates the key knowledge-based resources from the other.…”

The Two Facets of Collaboration: Cooperation and Coordination in Strategic Alliances

“…Asymmetric bargaining positions may date back to the very beginning of the relationship: for example, higher asset specificity increases the likelihood of renegotiation, arguably because of the asymmetries in dependence that it creates . But such asymmetries can also arise endogenously in the course of the alliance: for example, in learning alliances the fastest-learning partner may be able to force a renegotiation of terms and to demand concessions from slower-learning partners (Hamel, 1991;Inkpen & Beamish, 1997;Khanna, Gulati, & Nohria, 1998). As a rule, any initial contractual deficiencies and emergent internal or external developments can lead to incentive misalignment and promote renegotiation of the arrangement.…”

Strategic partnerships and the internationalisation process of software SMEs

“…Partnerships can be used by SMEs to build on innovative capability and technological competence, overcome weaknesses such as poor financial position or low levels of expertise in production, marketing and management (Jarratt, 1998) and to access alternative methods of serving customers (Elmuti & Kathawala, 2001). The firm may gain access to embedded knowledge or skills of their strategic partner (Inkpen & Beamish, 1997) permitting the smaller firm to increase market strength, visibility and credibility, and improving its international competitiveness (García-Canal et al, 2002). In an interesting extension to the concept of smallness, Narula & Hagedoorn (1999) suggest that small country firms will show a higher propensity than larger country firms to engage in international strategic partnerships as local demand is insufficient to achieve economies of scale.…”

“…Additionally, firms are susceptible to instability, or an unplanned change within the partnership, which may also result from shifts in bargaining power between parties (Inkpen & Beamish, 1997). Differences in organisational size may also result in one firm exerting negative power effects on the other (Elg & Johansson, 2001).…”

“…These partnerships also served as important foreign market entry mechanisms, allowing firms to accelerate firm sales cycles and reduce risk in overseas markets (Elmuti & Kathawala, 2001). These forms of partnerships serve to enhance firm credibility, provide entry mechanisms into foreign markets and provide vital local market knowledge (Inkpen & Beamish, 1997). Moen et al, (2004) maintain that strategic partnering activities are an important mechanism for increasing firm competencies and resource base, as strategic partnering facilitates firms to overcome these resource constraints by sharing intangible assets (Lee et al, 2000;Lu & Beamish, 2001).…”