Assessing the performance of foreign equity ventures: The case of Turkish manufacturing FDI firms

Abstract

The objective of this study is to examine and assess foreign equity ventures' (FEV) performance from the perspective of a developing country-based parent firms. In this study, we employed management, marketing, production and finance-related perceptual measures, as reported by the parent managers, to assess the performance of foreign subsidiaries. We hypothesized that the performance of sampled firms will be influenced by the following FEV characteristics: age, size, industry, host country location and entry mode. Based on an analysis of cross-sectional survey data concerning 94 FEVs of Turkish manufacturing firms (TMFs), we find that these firms achieve moderate level of performance. Our empirical results also indicate that while the type of host country positively influence the performance of FEVs, the age of FEVs have negative impact on performance.