The ownership structure contingency in the sequential international entry mode decision process: Family owners and institutional investors in family-dominant versus family-influenced firms

Kai Xu (), Michael A. Hitt () and Stewart R. Miller ()
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Kai Xu: The University of Texas at San Antonio
Michael A. Hitt: Texas A&M University
Stewart R. Miller: The University of Texas at San Antonio

Journal of International Business Studies, 2020, vol. 51, issue 2, No 1, 171 pages

Abstract: Abstract Extending our understanding of family firms and international business research with respect to entry mode decisions, this study explains how entry mode choice is the product of a sequential decision-making process, with an important ownership structure contingency. We propose that firms with a dominant family owner (family-dominant firms) prefer low equity ownership as their entry mode for the purpose of preserving their socioemotional wealth. Their preference is persistent even when the institutional investors are the dominant shareholders in the firm (family-influenced firms). This nuanced examination of the role family values play in the entry mode decision extends our understanding of how family firms enter international markets.

Keywords: family firms; entry mode decisions; institutional investors; sequential decision making (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (13)

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DOI: 10.1057/s41267-019-00250-8

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