Modes of acquiring host-country experience and performance of international joint ventures in Japan
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Drawing upon organizational learning literature, we examine how different modes of acquiring host-country experience (HCE) affect international joint ventures (IJV) performance. Our study suggests that HCE improves IJV performance by reducing the liabilities of foreignness and cross-national collaboration confronting foreign firms. However, due to the difficulty of learning from experience, HCE may not always benefit IJV performance and may even harm it, depending on how it was accumulated. Our analysis of IJV survival and growth using data on IJVs in Japan between 1985 and 2000 supports this argument. Our findings have practical implications for leveraging HCE and suggest that the performance benefits of HCE should not be overstated.
Keywordshost-country experience international joint ventures experiential learning international joint venture survival international joint venture growth Japan
This study has been conducted with assistance from a Grant-in-Aid for Scientific Research from the Japan Society for the Promotion of Science.
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