Legitimacy in international joint ventures: It is still needed

Lailani Alcantara, Hitoshi Mitsuhashi, Yasuo Hoshino

Research output: Contribution to journalArticlepeer-review

36 Citations (Scopus)

Abstract

International joint ventures (IJVs) enable foreign firms to complement their lack of local knowledge and resources by accessing their local partners' knowledge and resource bases. However, IJV formation is not simply a means of overcoming legitimacy-related challenges that stem primarily from a local market's unfamiliarity with foreign firms. This paper proposes that foreign firms can increase the legitimacy of their IJVs to facilitate local market penetration by building interorganizational linkages through which third parties and, especially, prospective customers in local markets can infer the viability and competence of IJVs. Our empirical analyses of manufacturing IJVs in Japan support our arguments.

Original languageEnglish
Pages (from-to)389-407
Number of pages19
JournalJournal of International Management
Volume12
Issue number4
DOIs
Publication statusPublished - 2006 Dec
Externally publishedYes

Keywords

  • International joint ventures
  • Interorganizational linkages
  • Legitimacy
  • Signals

ASJC Scopus subject areas

  • Business and International Management
  • Finance
  • Strategy and Management

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