The performance correlates of ownership control: A study of U.S. and European MNE joint ventures in India

Kannan Ramaswamy, Lenn Gomes, Rajaram Veliyath

Research output: Contribution to journalArticlepeer-review

23 Scopus citations

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 between 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.

Original languageEnglish (US)
Pages (from-to)423-441
Number of pages19
JournalInternational Business Review
Volume7
Issue number4
DOIs
StatePublished - Aug 1998
Externally publishedYes

Keywords

  • Equity control
  • India
  • Joint ventures
  • Multinationals
  • Strategic alliances

ASJC Scopus subject areas

  • Business and International Management
  • Finance
  • Marketing

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