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Unformatted text preview: the licensing firm.
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n.4 - 4 JOURNAL OF INTERNATIONAL BUSINESS STUDIES, FIRST QUARTER 1992 By including firm-specific and market-specific factors that influence these
criteria (control, return, risk, and resources), Dunning [1977, 1980, 19881
developed a framework for explaining choice among exporting, licensing,
joint venture, and sole venture modes (see Figure 1). A brief description of
the main effects of these factors is presented below and is mainly used for
validating the results of this study. The main thrust of this research is on
examining the effects f interrelationships among these independent factors.
A detailed discussion of these effects is presented in the next section.
To compete with host countryf m in their own markets, firms must possess
superior assets and skills that canearn economic rents that are high enough
to counter the higher costof servicing these markets. A firm’s asset power
is reflected by its size and multinational experience, and
skills by its ability
to develop differentiat...
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