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A framework of international joint ventures exit: A resource dependence and learning perspective

  • Nemeth, Alexander
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    Although international joint ventures (IJVs) have been a dominant market entry mode for years, high failure rates have been reported. Hence, an important part of research on IJVs focuses on success in terms of survival or persistence. The literature on IJV survival and exit (i.e., termination), however, has important limitations. Addressing these limitations, I offer an IJV exit framework and corresponding propositions that apply resource dependence and learning theories. The framework illustrates how specific determinants influence the likelihood of an IJV's persistence or termination through liquidation, internalization or sell-off. It extends the uni-directional notion of the current IJV learning theory and illustrates that parental learning does not necessarily lead to an IJV's internalization, whereas absent learning does not inevitably result in an IJV's persistence. Furthermore, this article shows how particular aspects of a firm's culture such as uncertainty avoidance affect the exit of IJVs.

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    Paper provided by TU Bergakademie Freiberg, Faculty of Economics and Business Administration in its series Freiberg Working Papers with number 2012,02.

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    Date of creation: 2012
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    Handle: RePEc:zbw:tufwps:201202
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