1. Introduction and Overview. 2. Detecting Influential Observations and Outliers. 3. Detecting and Assessing Collinearity. 4. Applications and Remedies. 5. Research Issues and Directions for Extensions. Bibliography. Author Index. Subject Index.

Regression Diagnostics: Identifying Influential Data and Sources of Collinearity

Firms interested in servicing foreign markets face a difficult decision with regards to the choice of an entry mode. The options available to a firm include exporting, licensing, joint venture and sole venture. Several factors that determine the choice of a specific foreign market entry mode have been identified in previous literature. These factors can be classified into three categories: ownership advantages of a firm, location advantages of a market, and internalization advantages of integrating transactions. This study examines the independent and joint influences of these factors on the choice of an entry mode. Multinomial logistic regression model is employed to test the hypothesized effects.

/pdf/choice-of-foreign-market-entry-mode-impact-of-ownership-m7fizm2aaa.pdf

Choice of Foreign Market Entry Mode: Impact of Ownership, Location and Internalization Factors

We analyze the birth of capabilities and resources within organizations and within industries, and their historical antecedents, at the time of market entry. We find a consistent theme: the greater the similarity between pre-entry firm resources and the required resources in an industry, the greater the likelihood that a firm will enter that particular industry, and the greater the likelihood that the firm will survive and prosper. In addition, resource gaps affect the likelihood, speed and mode of entry.

https://www.anderson.ucla.edu/faculty/marvin.lieberman/docs/Helfat-Lieberman_ICC2002.pdf

The birth of capabilities: market entry and the importance of pre-history

Export performance research has proliferated in the last decade. Significant progress has been made in developing better theory and knowledge of the export performance of firms. However, the field of inquiry is characterized by a diversity of conceptual, methodological, and empirical approaches that inhibit the development of clear conclusions regarding the determinants of export performance. In this article, an updated review and synthesis of the empirical literature on determinants of export performance between 1987 and 1997 is offered. Using a combination of the narrative and vote‐counting approaches, 50 studies were identified, reviewed, and synthesized. Major directions for future research are also discussed.

The determinants of export performance: a review of the empirical literature between 1987 and 1997

Empirical studies of FDI have become much more ambitious in scope over the last 30 years. In the 1960s, the main focus of the Hymer-Kindleberger theory (Hymer, 1976; Kindleberger, 1969) and the product cycle theory (Vernon 1966) was exporting versus FDI. In the 1970s the internalisation approach identified licensing, franchising and subcontracting as other strategic options. The resurgence of mergers and acquisitions in the 1980s — often as a ‘quick fix’ route to globalisation — highlighted the choice between greenfield ventures and acquisitions. At the same time, the growing participation of US firms in IJVs drew attention to the role of cooperative arrangements.

https://link.springer.com/content/pdf/10.1057%2Fpalgrave.jibs.8490006.pdf

Analyzing Foreign Market Entry Strategies: Extending the Internalization Approach

Working paper (University of Michigan. School of Business Administration. Division of Research)

/pdf/r-d-spending-domestic-competition-and-export-performance-of-51lkjv2v32.pdf

R&D spending, domestic competition, and export performance of Japanese manufacturing firms

This paper empirically tests the impact of oligopolistic reaction and some firm–related and host country–related factors on FDI activities in the U.S. tire and textile industries. The results reveal that in an oligopolistic industry, firms' motivation of FDI is based on the behavior of rivals as well as host country–related and firm–related factors, while in a more competitively structured industry, firms do not actively counter the competitors' FDI activities.

https://link.springer.com/content/pdf/10.1057%2Fpalgrave.jibs.8490391.pdf

Oligopolistic Reaction and Foreign Direct Investment: The Case of the U.S. Tire and Textiles Industries

This paper analyzes spinoffs of Japanese firms and the use of the spinoff as an instrument to achieve corporate growth objectives. The initial separation of the organizations and its governance mode are analyzed in the context of transaction costs theory. Spinoffs may be created in order to (1) balance costs associated with managing diversified businesses, (2) generate growth based on core competencies of a firm, and (3) pursue an efficient internal labor market. In a changing environment, the spinoff has been a widely used flexible organizational arrangement that is suitable to survival and offers an alternative way of diversification.

Japanese spinoffs: Unexplored survival strategies

We analyze the nature of international competition among multinational firms in the tire industry. Using the frameworks of the theories of oligopolistic reaction and foreign direct investment, we find that the firms’ investment patterns are related to the number and identities of competitors, host country characteristics, and foreign experience. Global tire companies from several nations demonstrate oligopolistic reaction behavior.

https://link.springer.com/content/pdf/10.1057%2Fpalgrave.jibs.8491034.pdf

Foreign Direct Investment Location Strategies in the Tire Industry

Analyzing the timing, patterns, and competitive interactions of foreign direct investments (FDIs), we find evidence that Japanese automobile manufacturers compete selectively with their domestic rivals. While some firms appear to follow rivals’ investments, they also steer away from markets with incumbent Japanese competitors. Competing in some key markets, these firms also avoid unnecessary competition in other markets. This finding provides evidence that the “bandwagon effect” is not universal for FDI within oligopolistic industries.

Kiyohiko Ito

Papers

R&D spending, domestic competition, and export performance of Japanese manufacturing firms

Oligopolistic Reaction and Foreign Direct Investment: The Case of the U.S. Tire and Textiles Industries

Japanese spinoffs: Unexplored survival strategies

Foreign Direct Investment Location Strategies in the Tire Industry

Competitive interactions: the international investment patterns of Japanese automobile manufacturers