The entry-mode decision of Chinese outward FDI: Firm resources, industry conditions, and institutional forces

How do Chinese firms make their entry‐mode decision for their outward investments? Based on the three theoretical perspectives that balance the “strategy tripod,” our study conducted empirical tests using survey data collected from outward‐investing Chinese firms. We found that the cost advantage of...

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Bibliographic Details
Published in:Thunderbird international business review 2011-07, Vol.53 (4), p.483-499
Main Authors: Cui, Lin, Jiang, Fuming, Stening, Bruce
Format: Article
Language:English
Subjects:
Foreign investment
Market entry
Organizational learning
Strategic management
Studies
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Summary:How do Chinese firms make their entry‐mode decision for their outward investments? Based on the three theoretical perspectives that balance the “strategy tripod,” our study conducted empirical tests using survey data collected from outward‐investing Chinese firms. We found that the cost advantage of the investing firm and learning opportunities in the host industry have positive effects on the likelihood of a Chinese firm opting for wholly owned subsidiary against joint‐venture entry mode, while the market attractiveness of the host industry, host‐country restrictions, cultural barriers, and cognitive pressures have negative effects. © 2011 Wiley Periodicals, Inc.
ISSN:1096-4762
1520-6874
DOI:10.1002/tie.20425