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Enforcement and performance: The role of ownership, legalism and trust in international joint ventures

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  • Lin, Xiaohua
  • Wang, Cheng Lu

Abstract

This study integrates international joint venture (IJV) literature on ownership, trust, and legalism and examines their effects as enforcement mechanisms on IJV satisfaction. The hypotheses are tested across three samples of managers - Chinese, Western, and Asian - in China-based IJVs. Results showed that relationship among ownership, trust, legalism, and IJV performance varies across cultures. Specifically, equal ownership is positively associated with IJV satisfaction for Chinese partners but majority equity leads to less IJV satisfaction for Asian IJV partners. Trust is found to be positively associated with IJV satisfaction across all three samples. However, only for Western partners, legalism has a significant impact on satisfaction and moderates the effect of trust. Conceptual contributions, managerial implications, and limitations are discussed based on these results.

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  • Lin, Xiaohua & Wang, Cheng Lu, 2008. "Enforcement and performance: The role of ownership, legalism and trust in international joint ventures," Journal of World Business, Elsevier, vol. 43(3), pages 340-351, July.
    • Handle: RePEc:eee:worbus:v:43:y:2008:i:3:p:340-351
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    4. Marius G. Gehrisch & Stefan Süß, 2023. "Organizational behavior in international strategic alliances and the relation to performance – a literature review and avenues for future research," Management Review Quarterly, Springer, vol. 73(3), pages 1045-1107, September.
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    6. Ricardo E. Buitrago R. & María Inés Barbosa Camargo & Favio Cala Vitery, 2021. "Emerging Economies’ Institutional Quality and International Competitiveness: A PLS-SEM Approach," Mathematics, MDPI, vol. 9(9), pages 1-18, April.
    7. Jing Yang & Frank Tipton & Jiatao Li, 2011. "A review of foreign business management in China," Asia Pacific Journal of Management, Springer, vol. 28(3), pages 627-659, September.
    8. Wang, Cheng Lu & Chung, Henry F.L., 2013. "The moderating role of managerial ties in market orientation and innovation: An Asian perspective," Journal of Business Research, Elsevier, vol. 66(12), pages 2431-2437.
    9. Antonio K. W. Lau & Stacy H. N. Lee & Sojin Jung, 2018. "The Role of the Institutional Environment in the Relationship between CSR and Operational Performance: An Empirical Study in Korean Manufacturing Industries," Sustainability, MDPI, vol. 10(3), pages 1-17, March.
    10. Fadia Bahri Korbi & Karim Ben Slimane & Dora Triki, 2019. "Managing Crisis within International Joint Ventures Insights from the case of Délice-Danone during the Arab Spring in Tunisia," Post-Print hal-02568493, HAL.
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    13. Linda H. Y. Hsieh & Suzana B. Rodrigues, 2014. "Revisiting the Trustworthiness–Performance–Governance Nexus in International Joint Ventures," Management International Review, Springer, vol. 54(5), pages 675-705, October.

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