Survival of Japanese subsidiaries in the Middle East and North Africa (original) (raw)
Related papers
Journal of Management, 2007
This article integrates institutional theory and organizational learning perspective and proposes a contingency framework on the relationship between ownership strategies and subsidiary performance. Using a sample of Japanese subsidiaries worldwide, the article finds important main effects of ownership, institutional distance, and host country experience on subsidiary survival. Furthermore, the effect of ownership is contingent on institutional distance and host country experience. In institutionally distant countries, subsidiaries have better survival chances if foreign parents have more ownership. Host country experience has a negative impact on subsidiary survival, but the effect is weaker if foreign parents have larger ownership positions in the subsidiaries.
Survival and financial performance of Japanese subsidiaries in Malaysia and Thailand
2012
This paper empirically examines the effects of Japanese parent financial performance with interactions on the Japanese foreign subsidiaries financial performance. We used Japanese outward Foreign Direct Investment (FDI) with a panel data of two ASEAN countries that received the highest Japanese FDI for the period 2003 until 2009. The purpose of this paper is to establish a relationship that is statistically significant with regard to the performance of Japanese subsidiaries located in Malaysia and Thailand using the ORBIS database. A multiple regression model has been applied in this research and the results reveal that some parent's financial ratios have influence on the subsidiaries financial performance. Moreover, the parent company's 'R&D per operating value', 'profit margin,' and 'solvency ratio' are the best indicators of the performance of the subsidiaries in the two-host countries.
Performance of Japanese Overseas Subsidiaries: The Effects of Entry Mode and Ownership Advantages
Japanese Journal of Administrative Science, 1999
Performance of foreign subsidiaries of multinational enterprises (MNEs) is influenced by several factors. This study proposes that ownership advantages and entry mode choice of MNEs have influence on performance of their directly owned subsidiaries overseas. We investigate performance difference between the two FDI modes frequently used for entering to less-developed countries (LDCs), namely, international joint venture and greenfield venture. Ownership advantages of MNEs Thailand provides supporting evidence. test based on a sample of 190 Japanese directly-owned subsidiaries located in advantages are transferable from a parent firm to a subsidiary level. An empirical are hypothesized to be positively associated with subsidiary performance as those
American Journal of Economics, 2013
This paper emp irically examines the effects of a host government's local ownership restrictions, the choice of entry mode and Japanese subsidiaries performance in t wo selected developing countries namely Malaysia and Thailand that received among the highest Japanese FDI fo r fiscal years 2003 through 2009. The purpose of this paper is to investigate the influence of host government restriction by using subsidiary's financial data as the performance ind icator fro m ORBIS database. Our sample consists of 1267 cases. The results reveal that local host government restriction significantly influence the choice of entry mode and subsidiaries performance in the two developing countries.
This article identifies key factors that determine the profitability of Japanese firms abroad by using panel-data regression models on new, large-scale, subsidiary-level data over the 1990−1996 period. The results show that the determinants of subsidiary profits differ across host regions, suggesting that the economic and institutional factors specific to host regions influence significantly the profit performances of overseas subsidiaries. While the size effect on the subsidiary profitability is present in all the regions, other effects, such as experience, local supplier networks, local sales and macroeconomic conditions affect the performance of subsidiaries in a different manner by region.
International Business Review, 2005
We test the hypothesis that location factors have strong predictive power for mode of establishment and ownership choice of MNEs, by controlling for parent experience and capabilities in a sample of 751 manufacturing subsidiaries of 405 Japanese MNEs. In the European context of few ownership restrictions we find that host competitiveness, host culture type, and industrial growth are the most appropriate location predictors for entry mode. We create a profile of joint venture, full acquisition and wholly owned greenfield modes and reveal how different strategic contexts interact with location factors to determine the MNE expansion approach. Our results imply that location variables are important determinants of expansion strategy, indispensable in analysing subsidiaries of MNEs even in hosts with stable political environment. q
Japanese Journal of Administrative Science, 2003
This empirical study focuses on Japanese manufacturing, which established new entities in the manufacturing sector in the European Union. We are focusing on the choice of the MNE's between taking full ownership of their affiliate, and sharing it with another firm. The paper aims at providing further empirical evidence on the influence of some key variables in explaining it. Our results provide initial support for using a model which includes institutional and cultural variables, as well as transaction cost variables to predict firms' choices between joint venture and wholly owned subsidiaries in international expansion. Our findings also suggest that some host country's influence may act as a modifying or moderating variable in the diversification mode choice.
Japanese MNCs Investment Objectives and Subsidiary Performance
International Journal of Business and Management, 2012
This study explores the Japanese MNCs investment objectives and their subsidiary's performance in host-county. We found five main investment objectives by Japanese MNCs generally for establishing overseas or product network followed by obtain the local market, establish overseas distribution, information gathering and cheap labor cost. China in East Asia region indicates the highest number of Japanese MNCs outward FDI followed by Southeast Asia region (Singapore, Thailand, and Malaysia) in year 2003 and 2009. The high number of Japanese MNCs in Asia may be influence by bilateral and regional approaches to take advantage of Free Trade Agreement (FTA). Our empirical results also shows that Japanese investment in Asia region more prefer to choose 'obtain local market' in the early stage of entering to host country and revise to new investment objective after certain period of time to remain the firm's profitability.
Japanese firms' investment strategies in emerging economies
2000
Abstract: This study jointly examines the effects of organizational capabilities and public and private expropriation hazards on the level of equity ownership chosen for foreign subsidiaries in emerging markets. Specifically, we explore the mechanisms by which 660 Japanese multinational corporations draw upon industry-specific, country-specific and total international experience to mitigate these hazards in FDI for their 1,727 subsidiaries in 18 emerging markets.