An internalization approach to joint ventures: the case of Coca-Cola in China

Mok, Vincent, Dai, Xiudian and Yeung, Godfrey (2002) An internalization approach to joint ventures: the case of Coca-Cola in China. Asia Pacific Business Review, 9 (1). pp. 39-58. ISSN 1360-2381

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Abstract

In the presence of high transaction costs due to market imperfections, it is normally less expensive for multinational corporations (MNCs) to conduct their business activities in new markets through their internal corporate structures rather than by relying on the markets. Based on a case study of Coca-Cola's entry into the Chinese market, this paper tests the applicability of internalization theory to explaining the entry mode choices of MNCs in developing countries. Internalization theory reveals the economic rationale that was behind the changes in Coca-Cola's modes of entry as it moved from franchising to joint ventures (JVs) with selected local partners, and more recently to the combination of JVs and franchising.

Item Type: Article
Schools and Departments: School of Global Studies > Geography
School of Law, Politics and Sociology > Sociology
Subjects: H Social Sciences > HD Industries. Land use. Labour > HD0028 Management. Industrial Management
H Social Sciences > H Social Sciences (General)
Depositing User: Godfrey Yeung
Date Deposited: 19 Sep 2006
Last Modified: 06 Mar 2017 02:20
URI: http://sro.sussex.ac.uk/id/eprint/124
Google Scholar:7 Citations

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