Joint venture

Download Joint venture

Post on 04-Nov-2014

1.003 views

Category:

Economy & Finance

3 download

Embed Size (px)

DESCRIPTION

 

TRANSCRIPT

<ul><li> 1. Inputs<br />Share of Profit<br />Joint Venture<br />HOME COUNTRY<br />HOST COUNTRY<br />MNE<br />Local Firm<br />Share of Profit<br />Inputs<br />Joint Venture Company<br /></li></ul> <p> 2. Joint Venture<br />Advantages<br />Access to partners local knowledge<br />Reduction of concern about overpayment<br />Both parties have some performance incentives<br />Significant control over operation<br />Disadvantages<br />Potential loss of proprietary knowledge<br />Potential conflicts between partners<br />Neither partner has full performance incentive<br />Neither partner has full control<br />When Is a Joint Venture Appropriate?<br /></p> <ul><li>Both partners contribute hard-to-measure inputs </li></ul> <p> 3. Large expected mutual gains in the long-run 4. Trade secrets can be walled off </p>