Choice between Non-Equity Entry Modes: An Organizational Capability Perspective

Many studies have examined the choice between different types of equity and non-equity modes; however, none has focused on the choice between different types of non-equity modes that service-firms employ routinely. This study develops a theoretical framework based on the "organizational capabil...

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Veröffentlicht in:Journal of international business studies 2002-01, Vol.33 (2), p.223-242
Hauptverfasser: Erramilli, M. Krishna, Agarwal, Sanjeev, Dev, Chekitan S.
Format: Artikel
Sprache:eng
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Zusammenfassung:Many studies have examined the choice between different types of equity and non-equity modes; however, none has focused on the choice between different types of non-equity modes that service-firms employ routinely. This study develops a theoretical framework based on the "organizational capability" perspective to explain the choice between two non-equity modes-franchising and management-service contracts. While previous studies are based on the premise that foreign-market entrants choose a mode-equity or non-equity-that offers them most control given their particular circumstances, the premise of this study is that foreign entrants choose a non-equity mode that, in addition, offers effective transfer of the firm's capabilities to the host-country venture.
ISSN:0047-2506
1478-6990
DOI:10.1057/palgrave.jibs.8491014