Joint-venture autonomy: Resource dependence and transaction costs perspectives

Richard Butler and Salmi Sohod

Scandinavian Journal of Management, 1995, vol. 11, issue 2, 159-175

Abstract: The literature on joint-ventures has emphasized the joint-venture as a "child" of dominant parent organizations without paying much attention to the internal processes of managing the joint-venture. In particular joint-ventures have the potential to develop strategy of their own and to make autonomous decisions. Autonomy as assessed by the extent to which joint-ventures can develop their own working practices and culture, and influence the outcome of ten other areas of decision-making forms the main dependent variable of this study. A survey of 57 U.K. domestic joint-venture companies is used to investigate the dimensions of joint-venture autonomy and finds that autonomy can vary greatly across types of decision issues. Greatest autonomy was found to occur over training and other staff issues, whereas the least autonomy occurred over new product development and pricing decisions. An explanatory model of joint-venture autonomy is developed using resource-dependence and transaction cost theories. It was found, in accordance with expectations, that high joint-venture dependence upon parent organizations, and high parental dependence upon the joint-venture, led to reduced autonomy. However, it was also found that high ambiguity of joint-venture objectives lead to decreased autonomy, a finding in accordance with the transaction costs hypothesis. One aspect of autonomy, cultural autonomy, was found to be independent of both dependence and ambiguity. The implications of these findings are discussed in terms of a potential dynamic theory of joint-venture autonomy whereby, as joint-ventures develop an internal culture, they can increasingly develop their own products and process.

Date: 1995
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/095652219500001C
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:scaman:v:11:y:1995:i:2:p:159-175

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/872/bibliographic
http://www.elsevier. ... me/872/bibliographic

Access Statistics for this article

Scandinavian Journal of Management is currently edited by Janne Tienari

More articles in Scandinavian Journal of Management from Elsevier
Bibliographic data for series maintained by Catherine Liu ().