Exploring the Relationship Between Decision and Ownership Rights in Joint Ventures

Abstract

By applying property rights theory, we argue that the structure of residual decision and ownership rights in joint ventures depends on the distribution of intangible knowledge assets between the joint venture partners. Our analysis derives three hypotheses. The empirical setting for testing these hypotheses was the Hungarian market. We used a questionnaire to collect the data from a sample of 530 Hungarian joint venture companies. We received 80 completed responses establishing a rate of return of 15 percent. Our data confirm the hypotheses that the joint venture partner's intangible assets positively influence the proportion of residual decision rights, and that residual decision rights are positively related to ownership rights.