Dissertation: Multilevel determinants of foreign direct investments entry mode strategies and ...

Uutisen oletuskuva
Foreign direct investments entry mode strategies and post-entry subsidiary survival can be influenced by several different types of determinants. Yi Wang’s research analyses the impacts of firm, industry and institution specific determinants on foreign direct investments (FDI) ownership mode strategy, FDI establishment mode strategy and subsidiary survival together. Field of the study is marketing.
(kuva/picture: flickrcc)

The study applies transaction costs economics, resource- and institution-based view as the main theoretical foundations to approach firm, industry and institution specific determinants. Study also tests the potential moderating effects of two institution specific determinants: stage of institutional transition and regional institutional differences within China.

- Along with theoretical and empirical contributions, this research offers useful implications to both managers and policy makers, Wang tells.

The results reveal that the host country experience results in the preference for WOS and acquisitions investments and subsidiary survival. The later stage of institutional transition increases the probability of wholly-owned subsidiary (WOS) and acquisitions and subsidiary survival. While degree of product diversification is associated with joint ventures (JVs), parent firm size results in preference of acquisitions. Both of them significantly influence subsidiary survival. Regional institutional differences are positively related to WOS and greenfields investments. International experience is positively associated with JVs.

- Industry R&D intensity is positively associated with JVs, whereas industry sales’ growth encourages WOS. Industry growth in terms of the number of firms is not related to FDI entry mode strategy, whereas it is positively associated with subsidiary survival, says Wang.

WOS and acquisitions increase the probability to survive. The results confirm the moderating effects of both stage of institutional transition and regional institutional differences.

The developed hypotheses were tested using a sample of 405 FDIs made by Danish, Finnish, Norwegian and Swedish firms operating in China during 1982–2012.

Public defence

The public examination of M.Sc. Yi Wang’s doctoral dissertation “Multilevel Determinants of Foreign Investments Entry Mode Strategy and Subsidiary Survival of Multinational Enterprises in China: An Analysis of Firms from Small and Open Economies” is on Friday 21 November at 13 o’clock in auditorium Kurtén, Tervahovi. Professor Mehmet Demirbag from the University of Strathclyde, UK, will act as an opponent and professor Jorma Larimo as a custos.

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