Equity-based entry modes of emerging country multinationals: lessons from Turkey

Mehmet Demirbag, Ekrem Tatoglu, Keith Glaister

    Research output: Contribution to journalArticlepeer-review

    132 Citations (Scopus)


    Based on a sample of 522 foreign affiliates of Turkish multinational enterprises (MNEs) with varying levels of Turkish equity ownership, this study provides an empirical analysis of the determinants of equity-based entry mode strategies in host country markets. A number of hypotheses are developed to examine the impact of institutional, transaction specific and firm level variables on Turkish MNEs’ choice of equity ownership mode in their foreign affiliates. The results reveal that institutional variables are important in explaining the equity composition of foreign affiliates of Turkish MNEs. Particularly important in determining equity ownership mode were found to be political constraints, linguistic distance, knowledge infrastructure and the extent of parent diversity. Results concerning the influences of the size of the affiliate are contrary to expectations and contradict the findings of previous research. No support was found for the impact of cultural distance on the equity ownership mode of Turkish MNEs in their foreign affiliates. Apart from political constraints, equity ownership choice and its underlying determinants do not vary between emerging and developed host country markets.
    Original languageEnglish
    Pages (from-to)445-462
    Number of pages18
    JournalJournal of World Business
    Issue number4
    Publication statusPublished - Oct 2009


    • institutional theory
    • emerging countries
    • multinational enterprises
    • wholly owned subsidiaries
    • Turkey


    Dive into the research topics of 'Equity-based entry modes of emerging country multinationals: lessons from Turkey'. Together they form a unique fingerprint.

    Cite this