search query: @author Shaver, J. M. / total: 5
reference: 3 / 5
| Author: | Shaver, J. M. |
| Title: | Accounting for endogeneity when assessing strategy performance: Does entry mode choice affect FDI survival ? |
| Journal: | Management Science
1998 : APR, VOL. 44:4, p. 571-585 |
| Index terms: | STRATEGY PERFORMANCE APPRAISAL INVESTMENT COMPANIES |
| Language: | eng |
| Abstract: | Firms choose strategies based on their attributes and industry conditions. Therefore, strategy choice is endogenous and self-selected. Empirical models that do not account for this and regress performance measures on strategy choice variables are potentially mis-specified and their conclusions incorrect. It is highlighted how self-selection on unobservable or hard-to-measure characteristics can bias strategy performance estimates and an econometric technique that has been developed to account for this effect is recommended. It is empirically examined to see if entry mode choice influences foreign direct investment survival. In specifications, it is found that greenfield entries have survival advantages compared to acquisitions. This confirms previous findings. However, the significance of this effect disappears once self-selection of entry mode in the empirical estimates is accounted for. The results confirm that estimates from models that do not account for self-selection of strategy choice can lead to incorrect or misleading conclusions. |
SCIMA