The effect of uncertainty on FDI entry mode decisions: The influence of family ownership and involvement in the board of directors

Ming-Sung Kao, Anthony Kuo*

*此作品的通信作者

研究成果: Article同行評審

26 引文 斯高帕斯(Scopus)

摘要

This study aims to resolve the debate regarding whether family owners facilitate or restrain internationalization, by examining the role of family owners as firms cope with uncertainty. According to the transaction cost economics (TCE) perspective, which differentiates between internal (behavioral) uncertainty and external (environmental) uncertainty, firms tend to choose wholly-owned subsidiaries over joint ventures as internal uncertainty and external uncertainty decrease. We hypothesize that, due to family members' concerns regarding the preservation of socioemotional wealth (SEW), firms with higher family ownership and involvement in the board are even more likely to choose wholly-owned subsidiaries over joint ventures as internal uncertainty and external uncertainty decrease. We use a sample of 1463 observed investments from 681 companies publicly listed on the Taiwan Stock Exchange to test our hypotheses. The empirical results show that family owners' involvement in the board facilitates internationalization when facing low internal uncertainty; as internal uncertainty decreases, firms with higher family involvement in the board have a higher propensity to choose wholly-owned subsidiaries, the high-commitment FDI entry mode.

原文English
頁(從 - 到)224-236
頁數13
期刊Journal of family business strategy
8
發行號4
DOIs
出版狀態Published - 12月 2017

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