Technological Leadership and Foreign Investors' Choice of Entry Mode

Developing country governments tend to favor joint ventures over other forms of foreign direct investment, believing that local participation facilitates the transfer of technology, and marketing skills. The author assesses joint ventures' pot...

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Main Author:	Smarzynska, Beata K.
Format:	Policy Research Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	ACCOUNTING ADVERTISING ASSETS BANKING REFORM CLIMATE EMPLOYMENT EQUIPMENT FOREIGN ASSETS FOREIGN COMPANIES FOREIGN DIRECT INVESTMENT FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN INVESTORS FOREIGN OWNERSHIP FOREIGN PARTNER FOREIGN SALES GAS INFORMATION ASYMMETRY INSURANCE INTANGIBLE ASSETS LEGISLATION MARKETING NATURAL RESOURCES NET SALES NEW TECHNOLOGIES PRIVATIZATION PRODUCTION PROCESS PRODUCTIVITY PROFITABILITY R&D SERVICE INDUSTRIES STATEMENTS SUBSIDIARIES SUBSIDIARY TRANSFER OF TECHNOLOGY TRANSITION ECONOMIES WASHING WELLS DEVELOPING COUNTRIES JOINT VENTURES FINANCE FOREIGN DIRECT INVESTMENTS TECHNOLOGY TRANSFER SKILL ANALYSIS STATE-OWNED ENTERPRISES INDUSTRIAL ADAPTATION RESEARCH & DEVELOPMENT OWNERSHIP MARKETING TECHNIQUES
Online Access:	http://documents.worldbank.org/curated/en/2000/04/437881/technological-leadership-foreign-investors-choice-entry-mode http://hdl.handle.net/10986/18834

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recordtype	oai_dc
spelling	okr-10986-188342021-04-23T14:03:46Z Technological Leadership and Foreign Investors' Choice of Entry Mode Smarzynska, Beata K. ACCOUNTING ADVERTISING ASSETS BANKING REFORM CLIMATE EMPLOYMENT EQUIPMENT FOREIGN ASSETS FOREIGN COMPANIES FOREIGN DIRECT INVESTMENT FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN INVESTORS FOREIGN OWNERSHIP FOREIGN PARTNER FOREIGN SALES GAS INFORMATION ASYMMETRY INSURANCE INTANGIBLE ASSETS LEGISLATION MARKETING NATURAL RESOURCES NET SALES NEW TECHNOLOGIES PRIVATIZATION PRODUCTION PROCESS PRODUCTIVITY PROFITABILITY R&D SERVICE INDUSTRIES STATEMENTS SUBSIDIARIES SUBSIDIARY TRANSFER OF TECHNOLOGY TRANSITION ECONOMIES WASHING WELLS DEVELOPING COUNTRIES TRANSITION ECONOMIES JOINT VENTURES FINANCE FOREIGN DIRECT INVESTMENTS TECHNOLOGY TRANSFER SKILL ANALYSIS STATE-OWNED ENTERPRISES INDUSTRIAL ADAPTATION RESEARCH & DEVELOPMENT MARKETING OWNERSHIP MARKETING TECHNIQUES Developing country governments tend to favor joint ventures over other forms of foreign direct investment, believing that local participation facilitates the transfer of technology, and marketing skills. The author assesses joint ventures' potential for such transfers by comparing the characteristics of foreign investors engaged in joint ventures with those of foreign investors engaged in wholly owned projects in transition economies in the early 1990s. Unlike the existing literature, the author focuses on intra-industry differences rather than inter-industry differences in research and development, and advertising intensity. Empirical analysis shows that foreign investors who are technological, or marketing leaders in their industries, are more likely to invest in wholly owned projects than to share ownership. This is true in high- and medium-technology sectors, but not in industries with low research and development spending. The author concludes that it is inappropriate to treat industries as homogeneous in investigating modes of investment. She also suggests that in sectors with high research and development spending, joint ventures may present less potential for transfer of technology, and marketing techniques than wholly owned subsidiaries. 2014-06-30T17:27:09Z 2014-06-30T17:27:09Z 2000-04 http://documents.worldbank.org/curated/en/2000/04/437881/technological-leadership-foreign-investors-choice-entry-mode http://hdl.handle.net/10986/18834 English en_US Policy Research Working Paper;No. 2314 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	ACCOUNTING ADVERTISING ASSETS BANKING REFORM CLIMATE EMPLOYMENT EQUIPMENT FOREIGN ASSETS FOREIGN COMPANIES FOREIGN DIRECT INVESTMENT FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN INVESTORS FOREIGN OWNERSHIP FOREIGN PARTNER FOREIGN SALES GAS INFORMATION ASYMMETRY INSURANCE INTANGIBLE ASSETS LEGISLATION MARKETING NATURAL RESOURCES NET SALES NEW TECHNOLOGIES PRIVATIZATION PRODUCTION PROCESS PRODUCTIVITY PROFITABILITY R&D SERVICE INDUSTRIES STATEMENTS SUBSIDIARIES SUBSIDIARY TRANSFER OF TECHNOLOGY TRANSITION ECONOMIES WASHING WELLS DEVELOPING COUNTRIES TRANSITION ECONOMIES JOINT VENTURES FINANCE FOREIGN DIRECT INVESTMENTS TECHNOLOGY TRANSFER SKILL ANALYSIS STATE-OWNED ENTERPRISES INDUSTRIAL ADAPTATION RESEARCH & DEVELOPMENT MARKETING OWNERSHIP MARKETING TECHNIQUES
spellingShingle	ACCOUNTING ADVERTISING ASSETS BANKING REFORM CLIMATE EMPLOYMENT EQUIPMENT FOREIGN ASSETS FOREIGN COMPANIES FOREIGN DIRECT INVESTMENT FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN INVESTORS FOREIGN OWNERSHIP FOREIGN PARTNER FOREIGN SALES GAS INFORMATION ASYMMETRY INSURANCE INTANGIBLE ASSETS LEGISLATION MARKETING NATURAL RESOURCES NET SALES NEW TECHNOLOGIES PRIVATIZATION PRODUCTION PROCESS PRODUCTIVITY PROFITABILITY R&D SERVICE INDUSTRIES STATEMENTS SUBSIDIARIES SUBSIDIARY TRANSFER OF TECHNOLOGY TRANSITION ECONOMIES WASHING WELLS DEVELOPING COUNTRIES TRANSITION ECONOMIES JOINT VENTURES FINANCE FOREIGN DIRECT INVESTMENTS TECHNOLOGY TRANSFER SKILL ANALYSIS STATE-OWNED ENTERPRISES INDUSTRIAL ADAPTATION RESEARCH & DEVELOPMENT MARKETING OWNERSHIP MARKETING TECHNIQUES Smarzynska, Beata K. Technological Leadership and Foreign Investors' Choice of Entry Mode
relation	Policy Research Working Paper;No. 2314
description	Developing country governments tend to favor joint ventures over other forms of foreign direct investment, believing that local participation facilitates the transfer of technology, and marketing skills. The author assesses joint ventures' potential for such transfers by comparing the characteristics of foreign investors engaged in joint ventures with those of foreign investors engaged in wholly owned projects in transition economies in the early 1990s. Unlike the existing literature, the author focuses on intra-industry differences rather than inter-industry differences in research and development, and advertising intensity. Empirical analysis shows that foreign investors who are technological, or marketing leaders in their industries, are more likely to invest in wholly owned projects than to share ownership. This is true in high- and medium-technology sectors, but not in industries with low research and development spending. The author concludes that it is inappropriate to treat industries as homogeneous in investigating modes of investment. She also suggests that in sectors with high research and development spending, joint ventures may present less potential for transfer of technology, and marketing techniques than wholly owned subsidiaries.
format	Publications & Research :: Policy Research Working Paper
author	Smarzynska, Beata K.
author_facet	Smarzynska, Beata K.
author_sort	Smarzynska, Beata K.
title	Technological Leadership and Foreign Investors' Choice of Entry Mode
title_short	Technological Leadership and Foreign Investors' Choice of Entry Mode
title_full	Technological Leadership and Foreign Investors' Choice of Entry Mode
title_fullStr	Technological Leadership and Foreign Investors' Choice of Entry Mode
title_full_unstemmed	Technological Leadership and Foreign Investors' Choice of Entry Mode
title_sort	technological leadership and foreign investors' choice of entry mode
publisher	World Bank, Washington, DC
publishDate	2014
url	http://documents.worldbank.org/curated/en/2000/04/437881/technological-leadership-foreign-investors-choice-entry-mode http://hdl.handle.net/10986/18834
_version_	1764441577532424192

Technological Leadership and Foreign Investors' Choice of Entry Mode

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