However firms are hesitant to enter markets that are

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Unformatted text preview: ant managerial and financial resources even in markets that do not have high risks. In a high risk situation, f m could make a risk-averse choice resultingn the market us i being not served. 20 JOURNAL O F INTERNATIONAL BUSINESS STUDIES, FIRST QUARTER 1992 In addition to the preference for investment modes by large multinational firms in lower potential markets, a number of other interesting interaction P effects emerged from the study. First, small with limited multinational firms experience were found to prefer entry into markets that were perceived to have high potential through a joint venture. This result indicates that smaller, less multinationally experienced finns need to complement their resource needs in order to service a potentially attractive foreign market. As argued in the hypotheses section, the sharing of costs andrisks enables such fr s to reduce the long-term uncertainty more efficiently [Beamish and im irms that have higher abilityto develop differentiated Banks 19871. Second, f products are concerned about the possible loss of their advantage in countries that are perceived as having higher contractual risks. They show a strong dislike for the...
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This document was uploaded on 03/22/2014.

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