Firm Resources, Institutional Distance, and the Choice of Entry Mode

Jonas F. Puck, Markus Hödl, Igor Filatotchev, Thomas Lindner

Research output: Chapter in Book/Report/Conference proceedingBook chapterResearchpeer-review

Abstract

We build on the resource-based view and extend entry mode research by focusing on firms’ intention to transfer different resources from the parent firm to its overseas subsidiary. In line with our hypotheses, we find that parent firms that plan to transfer high levels of intangible resources to their foreign subsidiaries tend to choose wholly owned subsidiaries, while firms that intend to transfer high levels of tangible resources tend to choose international joint ventures. Moreover, we find that these relationships are moderated by institutional distance. We test our hypotheses using unique primary data from a sample of 128 foreign subsidiaries in the People’s Republic of China. Our results have important theoretical implications for international business strategy research as they develop further existing entry-mode theories.
Original languageEnglish
Title of host publicationDistance in International Business : Concept, Cost and Value
EditorsAlain Verbeke, Jonas Puck, Rob van Tulder
Number of pages32
Place of PublicationBingley
PublisherEmerald Group Publishing
Publication dateNov 2017
Pages239-270
Chapter11
ISBN (Print)9781787437197
ISBN (Electronic)9781787437180
DOIs
Publication statusPublished - Nov 2017
Externally publishedYes
SeriesProgress in International Business Research
Volume12
ISSN1745-8862

Keywords

  • Entry mode
  • Institutional distance
  • Intangible resources
  • Tangible resources

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