Forming international joint ventures (IJVs) with a local firm is a vital mode of entry into an overseas market by a multinational corporation. As a popular organizational mode for entering foreign markets, a dramatic increase of IJVs has been witnessed in the age of economic globalization. Specifically, the rise of emerging economies over past decades has attracted a large number of investors from developed economies and witnessed the upsurge of foreign subsidiaries established in emerging economies. Given the institutional differences between developed economies and emerging economies, IJVs are a commonly-used form of foreign subsidiaries established in emerging economies to manage institutional differences and accompanying organizational interdependence.

However, IJVs are often faced with a high instability rate and do not live up to their expectation before dissolution. Therefore, research in international business has long explored the fundamental question of what factors affect IJV dissolution from a wide range. Due to the structural complexity of IJVs, IJVs are usually suffering from both external and internal instability. Previous studies on IJV dissolution are used to considering only the interaction between the IJV and the host environment or the interaction between the foreign partner and the local partner alone. However, such a misconduct does not take the trilateral interaction relationship into full consideration and biases the true circumstances. It has been called upon several times to emphasize the dual nature of IJVs and corresponding trilateral framework when studying IJVs. However, prior literature is far from satisfactory in addressing this concern. To enrich the IJV dissolution research by emphasizing the peculiar structure of IJVs and addressing both internal and external legitimacy issues, I investigate the role of host country-level factor (i.e. media coverage), local partner-level factor (i.e. state ownership), foreign partner-level factor (i.e. host country experience), and multiple institution-level factors based on the “foreign partner-local partner-host environment” trilateral framework and the peculiar characteristics of emerging economies to obtain a holistic understanding of the focal relationships in emerging economies.

Based on a longitudinal panel dataset of 803 IJVs established in China, the empirical results of Cox proportional hazard model lend general supports to the hypotheses. 16 out of 17 hypotheses get supported. The study has three main findings: 1) Both media attention and media favorability help lower the possibility of IJV dissolution while the participation of state capital and Hong Kong Hong Kong, Macau, & Taiwan (HMT) capital in the IJV would strengthen the legitimacy effect endorsed by media coverage in Chinese context. 2) State ownership could on one hand increase media coverage thus improve the legitimacy and consequently the survival rates of IJVs while on the other hand holds a curvilinear U-shaped relationship with dissolution through regulatory favorability but with costs. 3) The effects of host country experience possessed by the foreign investor are a matter of relative significance between institutional dependence and relational dependence. Host country experience could on one hand lower the rates of IJV dissolution by helping IJVs to absorb external constraints while on the other hand increase the risk of IJV dissolution by lowering the dependence of foreign partner on the local partner.

In summary, the theoretical contributions of my dissertation can be summarized in the following three aspects. First and foremost, based on legitimacy perspective, study one contributes to introducing the role of media coverage to IB literatures and enriching the antecedents of IJV dissolution from the perspective of external evaluations. It also extends both the applicability and the theoretical boundary of external-internal legitimacy perspective through explaining the external legitimacy brought by media coverage and the internal legitimacy caused by governance structure. Though scholars have acknowledged the importance of legitimacy in establishing a foreign operation (Shi et al., 2014), the emphases are restrained in the resource-, industry-, and country-factors but neglecting the superior legitimacy endorser—media. My pioneering investigation should not only enrich the antecedents of IJV dissolutions in terms of external evaluations but also encourage the revisit to the legitimacy literatures to look for further antecedents that influence the sustainability of international operations. Specifically, I extend the applicability and theoretical boundary of the external-internal legitimacy framework. On one hand, I have empirically verified that the media coverage is the additional external legitimacy source after controlling firm-related factors like size, age, and etc.; on the other hand, I have identified that external and internal legitimacies are not necessarily substituting but could reinforce each other. When the internal legitimacy determined by the governance structure well aligns with the external legitimacy presented by the media, IJVs would gain additional advantages to sustain their operations.

Second, study two uncovers two underlying mechanisms (i.e. media coverage and regulatory supports) for the relationship between state ownership and IJV dissolution in international cooperation, especially in inward foreign direct investment, which unpacks the “black box” for the focal relationship and provides further extensions toward state capitalism and institutional literatures. Building on the pioneer study of Mohr, Wang, and Fastoso (2016) on the relationship between state ownership and IJV dissolution, I question the monotonic logic by focusing on the external regulatory dependence only and uncover the holistic in-depth underlying mechanisms between state ownership and IJV dissolution. Specifically, I propose two channels that state ownership helps IJVs to have heterogeneous longevity: media coverage and regulatory supports. On one hand, I introduce the role of media coverage to IB literatures as a novel antecedent of IJV dissolution. On the other hand, I caution that the direct relationship between state ownership and IJV dissolution is not monotonic but rather carries with unexpected costs inside the IJV per se. In alignment with the previous postulation that state ownership brings in both benefits and costs, my theorization and further empirical confirmation have both corroborated the statement and extended such conceptualization to IB domain.

In addition, I find that the political power is not a monolithic body in China. Specifically, the generation of media coverage induced by state ownership and the effect of state ownership/media coverage on IJV dissolution varies across different sub-national regions with the observations from different provinces in China, lending support to the significance of intra-province sub-national institutions in large and complex emerging economies. Such finding adds another sub-national dimension to state capitalism and institutional studies such that intra-province spatial variations configurate further heterogeneities among organizations, replenishing the overemphasis of inter-province sub-national institutions over the past decade.

Third, based on the complicated ownership structure of IJVs and their duality attribute as both foreign subsidiaries and joint ventures, study three precipitates a “foreign partner-local partner-host environment” trilateral framework for the analysis of cross-border organizations that involve partnership and introduces institutional dependence and relational dependence concepts into the paradigm of resource dependence theory. Given their complicated ownership structure and duality attribute, either partially emphasizing the environmental contingency or inter-partner relationship would generate biased conclusions. My theorization and empirical evidence have ascertained such logical fallacy by showing that the link between host country experience and IJV dissolution is not monotonic but rather dynamic. Relatedly, my theorization and empirical outputs introduce new nuances to the paradigm of resource dependence theory. I bring in institutional dependence and relational dependence concepts by applying the speculation of the multiplicity of dependence. Therefore, this study challenges the present view of resource dependence theory that focuses on the environmental dependence only by reminding that societal contexts and resource dependence of joint ventures can exist in multiple dimensions.