Factors Influencing The Ownership-based Foreign Entry Mode Choice(The Choice Between Wholly Owned Subsidiary(WOS) And Joint Venture(JV))

Iran nuclear deal in 2016,agreement in Vienna,makes Iran a new focus of international investments by foreign companies.How to enter this market and what entry mode should be taken,remain inconclusive.This study first will explore the equity entry modes of SMEs into the Iran market from different theoretical perspectives and starts with a review of the literature on foreign market selection and entry mode selection.According to the transaction cost and institutional theories some general hypotheses are presented,and it continues with talk about Iran market and three main reasons of choosing Iran to do the research.In the following methodology and questionnaire are presented in the third chapter.In this study both Primary and Secondary data were utilized.The questionnaire used in this study was originally composed in English and expanded among 353 foreign SMEs registered in Organization for Investment,Economic and Technical Assistance of Iran(O.I.E.T.A.I.)database from 7 different investment sectors(Industry,Construction,Service,Agriculture,Mining,Transport and communications,Water Electricity and Gas supply).In chapter four on a sample of 288 completely filled questionnaires data analysis including non-response bias,common method variance,descriptive statistics,complete validity and reliability tests for each of the questionnaire variables,confirmatory factor analysis for the whole model,correlation analysis and two stages logistic regression were examined.Chapter five explains supported and rejected direct and moderating effects of the research independent variables on the research dependent variables(SMEs equity entry mode choice and performance).According to the finding related to 24 hypotheses of this research,asset specificity,top management team's characteristics(firm tenure and individual international experience),SMEs host country experience,imitation,strong host country network ties positively and environmental uncertainty and regulative risk negatively associated with choosing a wholly owned entry mode in Iran.Respect to the SMEs entry mode motives,Preserve and exploit proprietary technology positively,Market development and Location advantages negatively influence on SMEs Wholly owned entry decisions(no significant support for financial,operational and managerial motives).No significant support concerning the effects of internal isomorphism pressures,SMEs international experience,SMEs size,and cultural distance on the SMEs equity entry mode decisions were found in this research.Also,with respect to the second purpose of this study,it appears that the compatible entry modes with the research conceptual model perform better than other modes.If future studies support our results,then managers will be able to use the research model to select superior performing international entry modes.Chapter six contains discussion,theoretical and managerial contributions,research limitations and insights for the future research.