No Strategy is an Island to Itself: China First-Mover and Other FDI Strategiesâ€™ Interaction Effects
Bradley J. Koch
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Bradley J. Koch: Grand Valley State University, USA
International Journal of Asian Business and Information Management (IJABIM), 2010, vol. 1, issue 3, 35-53
The first-mover strategy for foreign investment is examined to determine under what conditions a significant effect exists when it is combined with other foreign investment strategies like partner selection, geographical market focus, joint-venture control, and resource commitment strategies. Using official audited data and survey data from Sichuan, the results reveal that there are significant interaction effects. The interaction effects can eliminate first-mover advantage, create a first-mover effect that previously didnâ€™t exist, or change the direction of the effect. Consequently, the author argues that it is better to analyze strategies as a set that is formed by a series of strategic decisions made by managers as they establish foreign joint ventures and wholly owned subsidiaries.
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