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

Alexander Nemeth

No 2012/02, Freiberg Working Papers from TU Bergakademie Freiberg, Faculty of Economics and Business Administration

Abstract: 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.

Keywords: International Joint Venture; Termination; Exit; Resource Dependence; Learning; Internationale Joint Venture; Beendigung; Exit; Ressourcenabhängigkeit; Lernen (search for similar items in EconPapers)
JEL-codes: L21 L24 L25 (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:tufwps:201202

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