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Optimal ownership in joint ventures with contributions of asymmetric partners

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  • Marco Marinucci

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Abstract

This paper faces two questions concerning Joint Ventures (JV) agreements. First, we study how the partners contribution affect the creation and the profit sharing of a JV when partners' effort is not observable. Then, we see whether such agreements are easier to enforce when the decision on JV profit sharing among partners is either delegated to the independent JV management (Management Sharing) or jointly taken by partners (Coordinated Sharing). We find that the firm whose effort has a higher impact on the JV's profits should have a larger profit shares. Moreover, a Management sharing ensures, at least in some cases, a wider range of self-enforceable JV agreements.
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Marco Marinucci, 2009. "Optimal ownership in joint ventures with contributions of asymmetric partners," Journal of Economics, Springer, vol. 97(2), pages 141-163, June.
  • Handle: RePEc:kap:jeczfn:v:97:y:2009:i:2:p:141-163
    DOI: 10.1007/s00712-009-0066-y
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    References listed on IDEAS

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    Cited by:

    1. Wang, Susheng & Zhu, Tian, 2016. "Optimality of the 51:49 equity structure," Economics Letters, Elsevier, vol. 145(C), pages 270-273.
    2. Hiroshi Osano, 2011. "Partial Ownership and Strategic Alliances with Reallocation of Corporate Resources," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 167(2), pages 202-223, June.
    3. ROELS, Guillaume & CHEVALIER, Philippe & WEI, Ying, 2012. "United we stand? Coordinating capacity investment and allocation in joint ventures," CORE Discussion Papers 2012045, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).

    More about this item

    Keywords

    Joint ventures; Strategic alliances; Ownership structure; Asymmetries; D43; L13; L14; L22;

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure

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