An Empirical Study of Wholly-Owned Subsidiaries and Joint Ventures for Entry into China Markets

The aim of this study is to empirically investigate the effectiveness of The Eclectic Theory in explaining the entry mode choices of Taiwanese Electronic Components firms in China markets during the time period from 2003 to 2005. The annual data includes as many as 267, 324, and 283 firms respectively. This study explores how the ownership, location, and internalization advantages (OLI advantages) influence the entry mode choices between wholly-owned subsidiaries (WOS) and joint ventures (JV) of Taiwanese Electronic Components firms. It also identifies those factors that have an important impact on the choices of entry mode and provides meaningful suggestions for the new firms that wish to invest in the China market