Institutional investments in international joint ventures: corporate entrepreneurship in emerging market regions

This paper investigates the outcome of international joint ventures (IJVs) in emerging market regions as a specific activity of corporate entrepreneurship from the perspective of a development finance institution. Based on 1,050 terminated IJVs during 1969–2016, the paper addresses the question of how investment characteristics are linked to intended and unintended termination of institutional investments in IJVs. Our results demonstrate that approximately 80% institutional investments in emerging markets have achieved their initial purposes and thus terminated intentionally. Furthermore, the study finds that Africa is the most challenging region to invest in, whereas Asia is the region in which most of the initial purposes of the investments in IJVs have been achieved. Furthermore, our study reveal that intended termination is positively associated with the length of IJVs, IJVs formed in 2000s (as opposed to 1990s), and IJV size. Number of people employed in the IJV is not significantly associated with intended and unintended termination of institutional investments.