Knowledge Acquisition and Performance: The Role of Foreign Parents in Korean IJVs

Abstract

In this paper, we investigate the influence of the foreign firm, through its interaction with the local partner, on the extent to which international joint ventures (IJVs) acquire knowledge and reach a higher level of performance. Based on the literature, we posit and test the proposition that there is a positive relationship between IJVs’ knowledge acquisition from foreign firms and their performance. To date, very few studies exist on IJVs in Korea, and fewer still examine the relationship between management knowledge acquired from foreign parents and IJVs’ performance. Using a sample of IJVs in Korea, this paper contributes to the literature, firstly by examining and confirming the positive relationship between managerial knowledge acquisition from foreign parents and IJV performance; and secondly, by testing for the extent of foreign firm support, and the relationship between parents with respect to both managerial knowledge acquisition and performance. This study extends knowledge on IJV knowledge acquisition and performance, more specifically in the Korean context.