‘Trojan Horse’ or ‘ Workhorse’ ?
The evolution of U.S.- Japanese Joint Ventures in the USA
J-F Hennart, Thomas Roehl and Dixie S. Zietlow
← Rapid growth of Japanese FDI in the U.S.A.
← 1st significant investment by a non-Western nation ((Japan)
← Suspicion: Lot of authors suspect that the Japanese firms’ behavior disadvantages their partners (in a J.V.)
← Authors found out that the Japanese partner was:
( Good at learning from their partner (US/EU partner)
( Once the learning is complete
( Japanese partner has no reason to continue the JV
( JV end up by being liquidate/acquire (by buying the US stakes of his partner) by ...view middle of the document...
= the degree to which the knowledge possessed by the firm's employees is open and accessible to the other joint venture partner.
Agreeing with Reich/Mankin, all Western managers interviewed believed that the Japanese were inherently less transparent than themselves.
= How you get the information, how receptive you are.
Receptivity is > in Japanese firms than in their Western counterparts.
( Since Hamel found that Japanese firms tend to possess more of these 3 factors than their American partners, he concluded that U.S.-Japanese joint ventures will tend to end up fully acquired by their Japanese partners.
Evolution of JV:
3 possible scenarios:
« Trojan Horse » Hypothesis is verified if:
← Strong version:
The # of cases of U.S.-Japanese J.V. in the USA where the Japanese partner buys full ownership from its U.S. partner is > than those where the Japanese partner sells its share to its U.S. partner or where ownership shares remain unchanged.
← Weak version:
The # of cases of U.S.-Japanese J.V. in the USA where the Japanese partner buys full ownership from its U.S. partner or where the joint venture is liquidated is higher than those where the Japanese partner sells its share to its U.S. partner or where the ownership shares remain unchanged.
This paper attempt to discover whether a Trojan Horse characterisation fits the full population of US-Japanese JV or not.
A lot of JV were taken to see if there were a trend towards acquisition/ liquidation by the Japanese parents.
( Does the Trojan Horse hold in real-life or not:
The analysis of our...