IDEAS home Printed from https://ideas.repec.org/a/eee/iburev/v22y2013i5p883-893.html
   My bibliography  Save this article

Institutional forces in adoption of international joint ventures: Empirical evidence from British retail multinationals

Author

Listed:
  • Owens, Martin
  • Palmer, Mark
  • Zueva-Owens, Anna

Abstract

In this study, we used institutional theory as a lens to understand the factors that influence the adoption of international joint ventures. Drawing on case evidence from British retail multinationals, we found MNEs adopting IJVs to manage a range of host market institutional pressures and to build legitimacy in foreign markets. Normative institutional legitimacy with customers, property agents and employees emerged as particularly salient for MNEs in our retail cases. The findings further indicated that IJV-derived legitimacy is central to market entry and development objectives. Finally, contrary to institutional theory's central assumption that MNEs seek to conform to institutional pressures, we find IJVs enabling MNEs to practice non-conforming responses, including negotiating and altering local social norms.

Suggested Citation

  • Owens, Martin & Palmer, Mark & Zueva-Owens, Anna, 2013. "Institutional forces in adoption of international joint ventures: Empirical evidence from British retail multinationals," International Business Review, Elsevier, vol. 22(5), pages 883-893.
    • Handle: RePEc:eee:iburev:v:22:y:2013:i:5:p:883-893
    DOI: 10.1016/j.ibusrev.2013.01.002
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0969593113000036
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ibusrev.2013.01.002?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Michael Hitt & M. Tina Dacin & Edward Levitas & Jean-Luc Arregle & Anca Borza, 2000. "Partner Selection in Emerging and Developed Market Contexts : Resource-Based and Organizational Learning Perspectives," Post-Print hal-02276706, HAL.
    2. Hyder, Akmal S., 1999. "Differences between developed and developing country joint ventures -- a reality or a myth?," International Business Review, Elsevier, vol. 8(4), pages 441-461, August.
    3. Ahlstrom, David & Bruton, Garry D. & Yeh, Kuang S., 2008. "Private firms in China: Building legitimacy in an emerging economy," Journal of World Business, Elsevier, vol. 43(4), pages 385-399, October.
    4. Marjorie A Lyles & Jane E Salk, 1996. "Knowledge Acquisition from Foreign Parents in International Joint Ventures: An Empirical Examination in the Hungarian Context," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 27(4), pages 877-903, December.
    5. Peter S Davis & Ashay B Desai & John D Francis, 2000. "Mode of International Entry: An Isomorphism Perspective," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 31(2), pages 239-258, June.
    6. Neil M. Coe & Yong-Sook Lee, 2006. "The Strategic Localization of Transnational Retailers: The Case of Samsung-Tesco in South Korea," Economic Geography, Taylor & Francis Journals, vol. 82(1), pages 61-88, January.
    7. Andrew C. Inkpen, 2000. "A note on the dynamics of learning alliances: competition, cooperation, and relative scope," Strategic Management Journal, Wiley Blackwell, vol. 21(7), pages 775-779, July.
    8. Bruce Kogut & Harbir Singh, 1988. "The Effect of National Culture on the Choice of Entry Mode," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 19(3), pages 411-432, September.
    9. Daphne Yiu & Shige Makino, 2002. "The Choice Between Joint Venture and Wholly Owned Subsidiary: An Institutional Perspective," Organization Science, INFORMS, vol. 13(6), pages 667-683, December.
    10. Mike W Peng & Denis Y L Wang & Yi Jiang, 2008. "An institution-based view of international business strategy: a focus on emerging economies," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 39(5), pages 920-936, July.
    11. M. Tina Dacin & Christine Oliver & Jean‐Paul Roy, 2007. "The legitimacy of strategic alliances: an institutional perspective," Strategic Management Journal, Wiley Blackwell, vol. 28(2), pages 169-187, February.
    12. John A. Dawson, 2007. "Scoping and conceptualising retailer internationalisation," Journal of Economic Geography, Oxford University Press, vol. 7(4), pages 373-397, July.
    13. Jane W Lu, 2002. "Intra- and Inter-organizational Imitative Behavior: Institutional Influences on Japanese Firms' Entry Mode Choice," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 33(1), pages 19-37, March.
    14. Michael Hitt & M. Tina Dacin & Edward Levitas & Jean-Luc Arregle & Anca Borza, 2000. "Partner Selection in Emerging and Developed Market Contexts : Resource-Based and Organizational Learning Perspectives," Post-Print hal-02312691, HAL.
    15. Jean-François Hennart, 1991. "The Transaction Costs Theory of Joint Ventures: An Empirical Study of Japanese Subsidiaries in the United States," Management Science, INFORMS, vol. 37(4), pages 483-497, April.
    16. Mark Palmer, 2006. "International retail joint venture learning," The Service Industries Journal, Taylor & Francis Journals, vol. 26(2), pages 165-187, March.
    17. Bruce Kogut, 1988. "Joint ventures: Theoretical and empirical perspectives," Strategic Management Journal, Wiley Blackwell, vol. 9(4), pages 319-332, July.
    18. Keith W. Glaister & Peter J. Buckley, 1996. "Strategic Motives For International Alliance Formation," Journal of Management Studies, Wiley Blackwell, vol. 33(3), pages 301-332, May.
    19. Dong, Li & Glaister, Keith W., 2006. "Motives and partner selection criteria in international strategic alliances: Perspectives of Chinese firms," International Business Review, Elsevier, vol. 15(6), pages 577-600, December.
    20. Boateng, Agyenim & Glaister, Keith W., 2002. "Performance of international joint ventures: evidence for West Africa," International Business Review, Elsevier, vol. 11(5), pages 523-541, October.
    21. Michael A. Hitt & David Ahlstrom & M. Tina Dacin & Edward Levitas & Lilia Svobodina, 2004. "The Institutional Effects on Strategic Alliance Partner Selection in Transition Economies: China vs. Russia," Organization Science, INFORMS, vol. 15(2), pages 173-185, April.
    22. Jean‐Francois Hennart, 1988. "A transaction costs theory of equity joint ventures," Strategic Management Journal, Wiley Blackwell, vol. 9(4), pages 361-374, July.
    23. Glaister, Keith W., 2004. "The Rationale for International Equity Joint Ventures," European Management Journal, Elsevier, vol. 22(5), pages 493-507, October.
    24. Huang, Ying & Sternquist, Brenda, 2007. "Retailers' foreign market entry decisions: An institutional perspective," International Business Review, Elsevier, vol. 16(5), pages 613-629, October.
    25. Gary Hamel, 1991. "Competition for competence and interpartner learning within international strategic alliances," Strategic Management Journal, Wiley Blackwell, vol. 12(S1), pages 83-103, June.
    26. Marc J. Dollinger & Peggy A. Golden & Todd Saxton, 1997. "The Effect Of Reputation On The Decision To Joint Venture," Strategic Management Journal, Wiley Blackwell, vol. 18(2), pages 127-140, February.
    27. John Child & Terence Tsai, 2005. "The Dynamic Between Firms’ Environmental Strategies and Institutional Constraints in Emerging Economies: Evidence from China and Taiwan," Journal of Management Studies, Wiley Blackwell, vol. 42(1), pages 95-125, January.
    28. Amy J Hillman & William P Wan, 2005. "The determinants of MNE subsidiaries' political strategies: evidence of institutional duality," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 36(3), pages 322-340, May.
    29. Yigang Pan, 1996. "Influences on Foreign Equity Ownership Level in Joint Ventures in China," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 27(1), pages 1-26, March.
    30. Marjorie A Lyles & Jane E Salk, 1996. "Knowledge Acquisition from Foreign Parents in International Joint Ventures: An Empirical Examination in the Hungarian Context," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 27(5), pages 877-903, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zhang, Hongjuan & Young, Michael N. & Tan, Justin & Sun, Weizheng, 2018. "How Chinese companies deal with a legitimacy imbalance when acquiring firms from developed economies," Journal of World Business, Elsevier, vol. 53(5), pages 752-767.
    2. Dau, Luis Alfonso, 2018. "Contextualizing international learning: The moderating effects of mode of entry & subsidiary networks on the relationship between reforms & profitability," Journal of World Business, Elsevier, vol. 53(3), pages 403-414.
    3. Hearn, Bruce, 2015. "Institutional influences on board composition of international joint venture firms listing on emerging stock exchanges: Evidence from Africa," Journal of World Business, Elsevier, vol. 50(1), pages 205-219.
    4. Calegario, Cristina Lelis Leal & Houston, Jack E. & Bruhn, Nádia Campos Pereira, 2015. "Foreign Market Entry Strategies In The United States/European Union Agribusiness Trade Context," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 3(3), pages 1-15, July.
    5. Frasquet, Marta & Dawson, John & Calderón, Haydeé & Fayos, Teresa, 2018. "Integrating embeddedness with dynamic capabilities in the internationalisation of fashion retailers," International Business Review, Elsevier, vol. 27(4), pages 904-914.
    6. Surdu, Irina & Mellahi, Kamel, 2016. "Theoretical foundations of equity based foreign market entry decisions: A review of the literature and recommendations for future research," International Business Review, Elsevier, vol. 25(5), pages 1169-1184.
    7. Nelaeva, Alena & Nilssen, Frode, 2022. "Contrasting knowledge development for internationalization among emerging and advanced economy firms: A review and future research," Journal of Business Research, Elsevier, vol. 139(C), pages 232-256.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jan Hendrik Fisch & Bjoern Schmeisser, 0. "Phasing the operation mode of foreign subsidiaries: Reaping the benefits of multinationality through internal capital markets," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 0, pages 1-33.
    2. Jan Hendrik Fisch & Bjoern Schmeisser, 2020. "Phasing the operation mode of foreign subsidiaries: Reaping the benefits of multinationality through internal capital markets," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 51(8), pages 1223-1255, October.
    3. Ahmad Arslan, 2012. "Impacts of institutional pressures and the strength of market supporting institutions in the host country on the ownership strategy of multinational enterprises: theoretical discussion and proposition," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 16(1), pages 107-124, February.
    4. Michael Nippa & Jeffrey J Reuer, 2019. "On the future of international joint venture research," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(4), pages 555-597, June.
    5. Li, Peng-Yu & Meyer, Klaus E., 2009. "Contextualizing experience effects in international business: A study of ownership strategies," Journal of World Business, Elsevier, vol. 44(4), pages 370-382, October.
    6. Li, Dan & Miller, Stewart R. & Eden, Lorraine & Hitt, Michael A., 2012. "The Impact of Rule of Law on Market Value Creation for Local Alliance Partners in BRIC Countries," Journal of International Management, Elsevier, vol. 18(4), pages 305-321.
    7. Yadong Luo & Huan Zhang & Juan Bu, 2019. "Developed country MNEs investing in developing economies: Progress and prospect," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(4), pages 633-667, June.
    8. Cuypers, I.R.P., 2009. "Essays on equity joint ventures, uncertainty and experience," Other publications TiSEM 8dc79e86-c625-467f-a450-8, Tilburg University, School of Economics and Management.
    9. Hearn, Bruce, 2015. "Institutional influences on board composition of international joint venture firms listing on emerging stock exchanges: Evidence from Africa," Journal of World Business, Elsevier, vol. 50(1), pages 205-219.
    10. Pak, Yong Suhk & Ra, Wonchan & Park, Young-Ryeol, 2009. "Understanding IJV performance in a learning and conflict mediated context," International Business Review, Elsevier, vol. 18(5), pages 470-480, October.
    11. Jiatao Li & Zhenzhen Xie, 2016. "Governance Structure and the Creation and Protection of Technological Competencies: International R&D Joint Ventures in China," Management International Review, Springer, vol. 56(1), pages 123-148, February.
    12. Janowicz, M.K. & Noorderhaven, N.G., 2002. "The Role of Trust in Interorganizational Learning in Joint Ventures," Discussion Paper 2002-119, Tilburg University, Center for Economic Research.
    13. Hitt, Michael A. & Li, Dan & Xu, Kai, 2016. "International strategy: From local to global and beyond," Journal of World Business, Elsevier, vol. 51(1), pages 58-73.
    14. Janowicz, M.K. & Noorderhaven, N.G., 2002. "The Role of Trust in Interorganizational Learning in Joint Ventures," Other publications TiSEM f10debea-9d7b-47c3-8d4f-b, Tilburg University, School of Economics and Management.
    15. Pi-Hui Chung, 2020. "How Does Partner Selection Affect IPO Performance?," Advances in Management and Applied Economics, SCIENPRESS Ltd, vol. 10(4), pages 1-5.
    16. Park, Byung Il & Ghauri, Pervez N., 2011. "Key factors affecting acquisition of technological capabilities from foreign acquiring firms by small and medium sized local firms," Journal of World Business, Elsevier, vol. 46(1), pages 116-125, January.
    17. Keith D. Brouthers & Liang Chen & Sali Li & Noman Shaheer, 2022. "Charting new courses to enter foreign markets: Conceptualization, theoretical framework, and research directions on non-traditional entry modes," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(9), pages 2088-2115, December.
    18. Shimizu, Katsuhiko & Hitt, Michael A. & Vaidyanath, Deepa & Pisano, Vincenzo, 2004. "Theoretical foundations of cross-border mergers and acquisitions: A review of current research and recommendations for the future," Journal of International Management, Elsevier, vol. 10(3), pages 307-353.
    19. Juasrikul, Sakdipon & Sahaym, Arvin & Yim, Hyunsoon (Sean) & Liu, Richie L., 2018. "Do cross-border alliances with MNEs from developed economies create firm value for MNEs from emerging economies?," Journal of Business Research, Elsevier, vol. 93(C), pages 98-110.
    20. Irina Surdu & Kamel Mellahi & Keith Glaister, 2017. "Once bitten, not necessarily shy? Organisational learning prior experience effects on foreign market re-entry commitment decisions," John H Dunning Centre for International Business Discussion Papers jhd-dp2017-04, Henley Business School, University of Reading.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:iburev:v:22:y:2013:i:5:p:883-893. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/133/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.