Are Joint Ventures with Local Firms an Efficient Way to Enter a Culturally Distant Market? The Case of Japanese Entry into the United States

Jean-Francois Hennart, Thomas Roehl and James M. Hagen

No 127311, Working Papers from Cornell University, Department of Applied Economics and Management

Abstract: We empirically test the proposition that foreign direct investors should use joint ventures with local firms for their first investment in unfamiliar markets. By tracking the expansion paths of Japanese investors in the US, we find no evidence that the growth of Japanese firms which first entered the US in a joint ventures with local firms is different from that of Japanese counterparts which used wholly-owned subsidiaries for initial US market entry.

Keywords: Marketing (search for similar items in EconPapers)
Pages: 25
Date: 2002-08
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Persistent link: https://EconPapers.repec.org/RePEc:ags:cudawp:127311

DOI: 10.22004/ag.econ.127311

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