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Broadening the foreign market entry mode decision: separating ownership and control

Author

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  • J R Brown

    (Department of Marketing, Pamplin College of Business, Virginia Tech, Blacksburg, USA)

  • C S Dev

    (School of Hotel Administration, Cornell University, Ithaca, NY, USA)

  • Z Zhou

    (School of Business, University of Hong Kong, Pokfulam, P.R.China)

Abstract

This paper argues that the ownership and control dimensions of foreign market entry mode choice should be separated, and that foreign market entry mode decisions should be expanded to business activities beyond production and distribution. Empirical results from the global hotel industry indicate that the transferability of the entrant's competitive advantages, the local market's absorptive capacity, and the availability of trustworthy local partners differentially affect the ownership and control dimensions of the entry mode decision. Journal of International Business Studies (2003) 34, 473–488. doi:10.1057/palgrave.jibs.8400050

Suggested Citation

  • J R Brown & C S Dev & Z Zhou, 2003. "Broadening the foreign market entry mode decision: separating ownership and control," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 34(5), pages 473-488, September.
  • Handle: RePEc:pal:jintbs:v:34:y:2003:i:5:p:473-488
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    Cited by:

    1. Ortiz-de-Urbina-Criado, Marta & Montoro-Sánchez, Ángeles & Mora-Valentín, Eva-María, 2014. "Impact of growth strategy on mode of governance in alliances," International Business Review, Elsevier, vol. 23(4), pages 838-848.
    2. Arvanitis, Spyros & Hollenstein, Heinz & Stucki, Tobias, 2016. "Does the explanatory power of the OLI approach differ among sectors and business functions? Evidence from firm-level data," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 10, pages 1-46.
    3. Kausar Yasmeen & Kuperan Viswanathan, 2017. "Influence of Country Factors on Entry Mode Through Knowledge and Transactional Cost Economics: Market Entry: Evidence from Construction Firms," International Journal of Economics and Financial Issues, Econjournals, vol. 7(3), pages 581-585.
    4. Karhunen, Päivi & Löfgren, Joan & Kosonen, Riitta, 2008. "Revisiting the relationship between ownership and control in international business operations: Lessons from transition economies," Journal of International Management, Elsevier, vol. 14(1), pages 78-88, March.
    5. Brouthers, Lance Eliot & Mukhopadhyay, Somnath & Wilkinson, Timothy J. & Brouthers, Keith D., 2009. "International market selection and subsidiary performance: A neural network approach," Journal of World Business, Elsevier, vol. 44(3), pages 262-273, July.
    6. Yadong Luo, 2007. "Private control and collective control in international joint ventures," Management International Review, Springer, vol. 47(4), pages 531-566, October.
    7. Dant, Rajiv P. & Grünhagen, Marko & Windsperger, Josef, 2011. "Franchising Research Frontiers for the Twenty-First Century," Journal of Retailing, Elsevier, vol. 87(3), pages 253-268.
    8. Musso, Fabio & Francioni, Barbara, 2011. "Foreign Markets Entry Mode Decision for Italian Small and Medium-Sized Enterprises," MPRA Paper 50067, University Library of Munich, Germany, revised 31 Oct 2011.
    9. Moses Acquaah, 2005. "Enterprise Ownership, Market Competition and Manufacturing Priorities in a Sub-Saharan African Emerging Economy: Evidence from Ghana," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 9(3), pages 205-235, September.
    10. J. Windsperger, 2009. "Allocation of decision rights in joint ventures," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 30(8), pages 491-501.
    11. Canabal, Anne & White III, George O., 2008. "Entry mode research: Past and future," International Business Review, Elsevier, vol. 17(3), pages 267-284, June.
    12. Zhi Shen & Francisco Puig & Justin Paul, 2017. "Foreign Market Entry Mode Research: A Review and Research Agenda," The International Trade Journal, Taylor & Francis Journals, vol. 31(5), pages 429-456, October.
    13. Musso, Fabio & Francioni, Barbara, 2009. "Foreign markets entry mode decision for SMEs. Key factors and role of industrial districts," MPRA Paper 32153, University Library of Munich, Germany.
    14. O’Cass, Aron & Ngo, Liem Viet & Heirati, Nima, 2012. "Examining market entry mode strategies via resource-based and institutional influences: Empirical evidence from a region-within-country economy context," Australasian marketing journal, Elsevier, vol. 20(3), pages 224-233.
    15. Yu, Chwo-Ming Joseph & Wong, Huang-Che & Chiao, Yu-Ching, 2006. "Local linkages and their effects on headquarters' use of process controls," Journal of Business Research, Elsevier, vol. 59(12), pages 1239-1247, November.
    16. Jell-Ojobor, Maria & Windsperger, Josef, 2014. "The Choice of Governance Modes of International Franchise Firms — Development of an Integrative Model," Journal of International Management, Elsevier, vol. 20(2), pages 153-187.
    17. Hemant Merchant & Ajai Gaur, 2008. "Opening the ‘Non-Manufacturing’ envelope: The next big enterprise for international business research," Management International Review, Springer, vol. 48(4), pages 379-396, April.
    18. Spyros Arvanitis & Heinz Hollenstein & Tobias Stucki, 2013. "Determinants of Internationalisation - Do they Differ among Sectors and Business Functions?," KOF Working papers 13-348, KOF Swiss Economic Institute, ETH Zurich.
    19. Karhunen, Päivi, 2008. "Managing international business operations in a changing institutional context: The case of the St. Petersburg hotel industry," Journal of International Management, Elsevier, vol. 14(1), pages 28-45, March.
    20. De Beule, Filip & Elia, Stefano & Piscitello, Lucia, 2014. "Entry and access to competencies abroad: Emerging market firms versus advanced market firms," Journal of International Management, Elsevier, vol. 20(2), pages 137-152.
    21. Quer, Diego & Claver, Enrique & Andreu, Rosario, 2007. "Foreign market entry mode in the hotel industry: The impact of country- and firm-specific factors," International Business Review, Elsevier, vol. 16(3), pages 362-376, June.
    22. Rosario Andreu & Enrique Claver & Diego Quer, 2017. "Firm-specific factors and entry mode choice," Tourism Economics, , vol. 23(4), pages 756-767, June.
    23. De Beule, Filip & Sels, Annabel, 2016. "Do innovative emerging market cross-border acquirers create more shareholder value? Evidence from India," International Business Review, Elsevier, vol. 25(2), pages 604-617.

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