The relative importance of old and new decision specific experience in foreign ownership strategies: an exploratory study

Kang Rae Cho and Prasad Padmanabhan

International Business Review, 2001, vol. 10, issue 6, 645-659

Abstract: In this paper, we examine the relative importance of old and recent decision specific experience for MNC's foreign ownership structure decision. Using established procedures to measure decision specific experience construct, we find, from data for Japanese MNCs for the period 1969-1991, empirical evidence that firms tend to rely on both old and recent decision specific experiences for their current ownership structure decision, but that they rely more on recent decision specific experience than on old decision specific experience, contrary to the conventional organizational learning view on the temporal importance of decision specific experience. Sub-sample analysis involving developed and developing countries indicates that both old and new decision specific experience are important for both groups of countries, but old (new) decision specific experience is marginally more important for investments made in developing (developed) countries.

Keywords: Japanese; foreign; ownership; strategy; Decision; specific; experience (search for similar items in EconPapers)
Date: 2001
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