The Performance Correlates of Ownership Control: A Study of U.S. and European MNE Joint Ventures in India
Department
Management and Entrepreneurship
Document Type
Article
Publication Date
8-1998
Abstract
This study reports findings from an empirical examination of the relationship between ownership control and joint venture performance. It conceptualized ownership control as a continuous variable so that the range of values of optimal equity holdings could be derived. Thus, it was possible to empirically determine both the form and strength of the relationship, aspects that prior studies have not addressed fully. The empirical examination was carried out on a longitudinal sample of joint ventures betw een U.S. and European MNEs and local firms in India. Results clearly show that the relationship between ownership control and performance is curvilinear. Contrary to the prevailing views that advocate an equal sharing of equity, performance was found to improve with increasingly unequal levels of ownership.
Journal Title
International Business Review
Journal ISSN
0969-5931
Volume
7
Issue
4
First Page
423
Last Page
441
Digital Object Identifier (DOI)
10.1016/S0969-5931(98)00022-5