انتخاب بین سرمایه گذاری سبز و تملک فرامرزی: رویکرد گزینه واقعی

The purpose of this study is to formalize the choice of market entry strategy for an individual multinational enterprise (MNE) from a dynamic perspective. It is argued that incorporating a suitable treatment of irreversibility, uncertainty and flexibility related to a MNEs investment decision gives further insights to the choice of cross-border acquisitions to greenfield investment as the preferred entry mode. In most cases, the initial entry strategy serves as a platform allowing the firm to make subsequent investments to exploit host-country advantages and capabilities. We allow for this by taking a two-step expansion strategy explicitly into account. The evolutionary process of the value of the foreign direct investment includes two stochastic elements as well as the timing that triggers the transition from export to foreign direct investment. The results suggest that uncertainty and future investment opportunities play an important role when it comes to transit from export to the first phase of the foreign direct investment commitment as well as have an impact on the choice of entry strategy.

In todays’ fast moving rapidly changing business and technological environment, the form of market entry in new foreign markets has become a crucial decision to most MNEs. Firms initially establish themselves in a foreign market through exporting. Although this entry strategy represents a low risk entry mode, it offers little control mechanism if market conditions change. Furthermore, export is associated with limited profits. Leaving other entry strategies, for example joint-ventures, disregarded, a firm will be faced with the decision to increase its resource commitment in the future in order to exploit further growth. Focusing on possible equity modes to enter a foreign market, greenfield investment, i.e. setting up a new plant, as well as the acquisition of an established company in the foreign market represent favorable foreign direct investment alternatives.1

In this paper, we briefly review the recent evidence of the growth in M&A activities in the global entry market process of multinational firms as well as the empirical driven literature concentrating on the choice of equity entry modes. The model introduced here is a first attempt to stress the sequential nature of foreign direct investment and to depict the importance of subsequent options on the initial entry decision. In line with the demand towards a new agenda for modelling the multinational firm, we present a real options model approach based on a two-phase market entry situation, stressing the need to consider sunk costs and uncertainty as opposed to static models. Although we did not explicitly model the time dependence, implicit results can be drawn due to the fact, that the evolution of the project value depend on time. We obtain a threshold that is determined by the associated entry costs, uncertainty and the location characteristics. Of course, the performance of the model depends on the accuracy of the parameter estimates. The results show the new complementary insight, that the choice of entry mode not only depends on the associated additional costs but also on the uncertainty surrounding the project. Furthermore, our results are consistent with the perceived dominant trend observed today for companies to speed up international expansion via foreign direct investment if high levels of location-specific attractiveness are present. In such a case, a high growth option value may justify the transition to more riskier modes. In cases of high instability and uncertainty, however, investment in the innovative second phase of the sequence will take place much later outperforming the effect of early commitment. Countries offering such an economic environment are disadvantaged and will not instantaneously benefit from the whole value of the foreign direct investment, because only a firms’ commitment to a stage will add value to the host country. However, further restrictions have to be made in order to differentiate for example between home-based augmenting and home-based exploiting motives surrounding the establishment of regional technology platforms. In addition, real option rights, and especially growth option rights are to a large extent not exclusive. Competition may cause an erosion of the option value, e.g. due to first-mover advantage. In such a case, it is worthwhile to extend the assumption that the value evolution of a foreign direct investment follows a geometric Brownian motion and to implement Poisson-Jump arguments.