INTERNATIONAL EXPANSION THROUGH SEQUENTIAL INVESTMENT: THE EFFECTS OF NATIONAL CULTURE ON BUYOUTS AND DISSOLUTIONS IN BIOTECHNOLOGY PARTNERSHIPS

Timothy B. Folta and Walter J. Ferrier
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Timothy B. Folta: University of Kentucky
Walter J. Ferrier: University of Kentucky

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Abstract: This study examines the role of national culture on an issue which is central to competitive strategy: whether to maintain flexibility or commit to a strategic direction. We consider that equity investments in foreign partners may be initiated as the first step in a sequential acquisition process. Applying a competing hazard model to a sample of 168 joint ventures and minority equity collaborations in the biotechnology industry, we find that cultural characteristics have some bearing on a firm's willingness to commit through partner acquisition or partnership dissolution, and its preference for flexibility embodied in maintaining an equity collaboration.

JEL-codes: D8 F23 L14 M21 D81 D83 (search for similar items in EconPapers)
Date: 1997-01-17
Note: Type of Document - Binary file formatted for Word for Windows95; prepared on IBM compat. PC; to print on HP LaserJet; pages: 29. Manuscript submitted to the Journal of International Business Studies
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