Document Type

Article

Publication Date

2-2008

Source Publication

International Journal of Strategic Management

Source ISSN

1555-2411

Abstract

This empirical paper tests hypotheses exploring the use of equity investment in international market entry by US-based firms. We first establish the respondents' use of equity or non-equity, and their international presence, and then proceed to test for determinants of investment. Using transaction cost theory and resource base theory we examine the influences of asset specificity, tacitness of strategic resources, country similarity, business similarity, environmental uncertainty and behavioral uncertainty on firm decisions to make equity investments. Six hypotheses are presented and tested on a sample of self-identified firms engaged in international business. The results for the exploratory study are significant for one hypothesis, and discussion follows regarding the lack of confirmation of the theory with this data set.

Comments

Published version. International Journal of Strategic Management, Vol. 8, No. 1 (February 2008). Publisher Link. © International Academy of Business Economics 2008. Used with permission.

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