Ownership Strategy of Multinational Enterprises and the Impacts of Regulative and Normative Institutional Distance: Evidence from Finnish Foreign Direct Investments in Central and Eastern Europe

Arslan, Ahmad; Larimo, Jorma

doi:10.1080/10669868.2010.523370

Cited by 44 publications

(44 citation statements)

References 67 publications

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“…With respect to Hypothesis 2 (Normative Distance), the factor that showed a statistically significant result was Beliefs. Note, however, that the results indicate that larger differences in beliefs would increase the probability of creating wholly-owned subsidiaries, contradicting our original hypothesis, but supporting the results previously reported by Arslan and Larimo (2010). One possible explanation for this result is that very different beliefs can make it difficult to identify a suitable partner.…”

Section: Hypotheses Testingcontrasting

confidence: 56%

“…There are also empirical studies in the literature whose results support the hypothesis of a negative association between the uncertainty of the institutional environment and the choice of joint ventures (e.g. Arslan & Larimo, 2010).…”

Section: Institutional Distancementioning

confidence: 57%

“…Nevertheless, some studies did not get support for the impact of international experience on the choice of ownership mode (e.g. Arslan & Larimo, 2010;Kogut & Singh, 1988). And Li and Meyer (2009) found that the effect of the firm's experience in the selection of entry mode varies according to the context of the host country.…”

Section: Firm Characteristicsmentioning

confidence: 99%

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Brazilian Multinationals' Ownership Mode: The Influence of Institutional Factors and Firm Characteristics

Ávila

Rocha

Silva

2015

BAR, Braz. Adm. Rev.

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This work investigates whether host countries institutional factors and firm characteristics can help the understanding of Brazilian multinationals' choices of ownership mode for their foreign direct investments (FDI). Brazil is a privileged locus for research on emerging market multinationals (EMNEs), given its growing stock of outward FDI. The paper contributes to a better understanding of the international strategic choices of EMNEs. First, the phenomenon under study is examined using the theoretical lenses of institutionalism. Second, the study looks at the relationship between state support and choice of ownership mode, a new issue in the area of international business. Third, differences between the decisions taken by manufacturing and service EMNEs are also examined. Fourth, the study focuses on an emerging country, Brazil. The quality of the regulatory environment of the host country, and differences in beliefs, cultural identity and management practices between the host country and the country of origin are factors of the institutional environment significantly related to the choice of ownership mode by Brazilian EMNEs. As to firm characteristics, our results show that state support favors the choice of joint ventures, and that service EMNEs also significantly prefer joint ventures, when compared to manufacturing firms. The findings also support the view that EMNEs are less sensitive to institutional weaknesses in host countries.

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Section: Hypotheses Testingcontrasting

confidence: 56%

Section: Institutional Distancementioning

confidence: 57%

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Brazilian Multinationals' Ownership Mode: The Influence of Institutional Factors and Firm Characteristics

Ávila

Rocha

Silva

2015

BAR, Braz. Adm. Rev.

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“…Some past studies analyzed the choice between greenfield investment and acquisition entry strategy by the investing foreign MNEs (e.g., Arslan & Larimo, 2011;Brouthers & Brouthers, 2000;Datta, Herrmann, & Rasheed, 2002;Demirbag et al, 2008Demirbag et al, , 2009Hennart & Park, 1993;Larimo, 2003;Shimizu, Hitt, Vaidyanath, & Pisano, 2004;Slangen & Hennart, 2008). Other IB studies addressed the ownership mode strategy of MNEs by studying the choice between wholly owned subsidiary or joint venture formation (e.g., Anderson & Gatignon, 1986;Arslan & Larimo, 2010;Brouthers & Hennart, 2007;Jung, Beamish, & Goerzen, 2008;Luo, 2001). However, the literature review reveals that very few IB and market entry studies (e.g., Jakobsen & Meyer, 2008) have analyzed acquisition entry strategy of MNEs specifically by differentiating between full acquisitions versus partial acquisitions, in case the MNE decides to acquire a local firm at time of market entry in a new target country.…”

Section: Introductionmentioning

confidence: 97%

Acquisition Entry Strategy of Nordic Multinational Enterprises in China: An Analysis of Key Determinants

Arslan¹,

Wang²

2014

Journal of Global Marketing

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This article addresses the key determinants of acquisition entry strategy (i.e., the choice between full versus partial acquisition) of Nordic multinational enterprises (MNEs) in China. Although general establishment and entry mode strategies have been a highly researched area in international business studies, acquisitions as a specific entry strategy and its different aspects have been scarcely researched. Therefore, the current study aims to fill the gap in literature by analyzing determinants of acquisition entry strategy based on three important theoretical bases: transaction cost economics, resource-based view, and institutional theory. Our study is one of the first to analyze acquisition entry strategy of MNEs from all four Nordic economies (Denmark, Finland, Norway, and Sweden) in China during 1987 through 2012, and this unique empirical context adds further value to the study findings. The empirical results show that high target country experience, high cultural distance, high level of product diversification, and subsidiary location in institutionally developed and open cities of China were positively associated with choice of full acquisitions by Nordic MNEs. On the other hand, high industry research and development intensity and timing of acquisition led to the choice of partial acquisitions by the investing Nordic MNEs.

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“…In neighbourhood of centralization, credit system and longstanding mutual trust relationships can be feasible. Nowadays in Chinese the Yangtse Delta and Zhu River Delta, economy of centralization has existed [6]. Advantage of centralization and location advantage of TNCs is a procedure of mutual promotion.…”

Section: Inspiration For China Brought By Integration Of Globalizatiomentioning

confidence: 99%

Integration of Globalization and Localization of TNCs and corresponding strategy of China

Huang¹

2016

Proceedings of the 6th International Conference on Electronic, Mechanical, Information and Management Society

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Abstract. Integration of globalization and localization has become inevitable trend of management activity of TNCs (Transactional Corporations). The paper begins with theory, which accounts for integration of globalization and localization, furthermore, it analyses the relationship between the integration and fostering of competitive advantage. Moreover, from practice, it cites case of Motorola and Haier as to present corresponding strategy of China.

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Ownership Strategy of Multinational Enterprises and the Impacts of Regulative and Normative Institutional Distance: Evidence from Finnish Foreign Direct Investments in Central and Eastern Europe

Cited by 44 publications

References 67 publications

Brazilian Multinationals' Ownership Mode: The Influence of Institutional Factors and Firm Characteristics

Brazilian Multinationals' Ownership Mode: The Influence of Institutional Factors and Firm Characteristics

Acquisition Entry Strategy of Nordic Multinational Enterprises in China: An Analysis of Key Determinants

Integration of Globalization and Localization of TNCs and corresponding strategy of China

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