Derivation of research hypotheses
The body of prior entry mode research primarily consists of two streams of FDI literature, namely studies on establishment mode choice and research dealing with ownership mode choice. Most scholars analysed determinants or outcomes of foreign company entry modes based on the ownership structure prevalent in the new venture, hence differentiating between the choice of a wholly-owned subsidiary or a joint venture (Brouthers & Hennart, 2007). In the context of emerging economies, Karhunen and colleagues (2014) assess the impact of regionally adjusted institutional distance on the choice between wholly-owned subsidiaries and joint ventures in Russia, while Li and Sun (2017) focus on the impact of the sub-national institutional level in China on foreign firm performance.
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