TAILIEUCHUNG - The choice between international joint ventures and Wholly owned subsidiaries

The choice between international joint ventures and Wholly owned subsidiaries. The p urp ose of this article is to analyze and exp lainf oreign investors ’entry mode choices between Wholly Owned Subsidiaries (WOS) and International Joint-ven- tures (IJ V). Research hypotheses have been established and verif ied over a samp le of 6603f oreignf irms who made investments in Vietnam during the periodf rom 1988 to 2010. | Journal of Economics and Development Vol. 44, , April 2012, pp. 91 - 100 ISSN 1859 0020 Entry Mode of MNEs in Vietnam: An Eclectic Model of The Choice Between International Joint Ventures and Wholly Owned Subsidiaries Vu Manh Chien Vietnam Commercial University, Vietnam Email: vmchien@ Phan Thanh Tu HKT Consultant, Vietnam Email: phanthanhtu@ Abstract The purpose of this article is to analyze and explain foreign investors’ entry mode choices between Wholly Owned Subsidiaries (WOS) and International Joint-ventures (IJV). Research hypotheses have been established and verified over a sample of 6603 foreign firms who made investments in Vietnam during the period from 1988 to 2010. The results of the study were in agreement with the eclectic model (Dunning, 1980, 1995). We found the significant impact of almost of components of OLI advantages, in the exception of MNEs’ size and cultural distance. The results indicate that: “O” advantages such as (experience and asset specificity) are positively associated with MNEs’ WOS choice, so negatively its IJV choice; “L” advantages such as investment risk, GDP growth and “I” advantages such as currency risk influence positively the MNEs’ IJV choice; so negatively its WOS choice. Keywords: Entry modes, international joint ventures, wholly owned subsidiaries, FDI, eclectic model, Vietnam Journal of Economics and Development 91 Vol. 14, , April 2012 1. Introduction business and argues that these theories are individually incomplete and do not fully explain the foreign investor’s choice of entry mode abroad. Therefore, the author proposes an eclectic theory, which is in fact a multi-theoretical approach for entry mode decisions. In this perspective, the current research aims to apply the eclectic paradigm for explaining the MNEs’ choice between IJV and WOS as entry mode into Vietnam - “an emerging tiger in Asia”. Multinational enterprises (MNEs) invest abroad for several reasons: some try to .

• Quản trị kinh doanh
• The choice between
• international joint ventures
• Wholly owned subsidiaries
• eclectic model
• Personality traits
• The choice of luxury
• Branded products
• Big Five model
• Structural equation modeling
• Natural gas
• Transaction costs
• Probit model
• Pipeline networks
• Determinant of the choice
• LNG tank trucks
• Malignant Gliomas
• Radioresistant Glioblastoma
• Radiobiology
• Chemokine Responses
• Hepatitis C Virus
• Treatment Responses
• state sponsored
• regulation
• constitutional law
• tax policy
• guiding constitutional
• policy considerations
• Social Sciences
• Climatic variables
• Natural rubber
• Oil palm
• Southern Thailand
• International Conference on Emerging Challenges
• Foreign direct investment
• Joint ventures
• International entry modes
• Emerging economies