Firm Resources And First Mover-advantages: An Empirical Analysis Of FDI In China Telecommunication Equipment Industry

The timing of entry into a new market is an important strategic issue for firms. Entering a new market at the "right" time can often be critical for success. However, Empirical findings regarding this issue in the past have typically been inconclusive or contradictory. This paper links the first-mover advantages with the resource-based of the firm and empirically studies the relationship between firm resources and first-mover advantages with regard to foreign direct investment in china. While this paper replicates some previous research on the issue, it also builds on the previous research by developing new theoretical arguments and adopting different research methods. This paper consults the conclusions and conducts a discriminant analysis using the technique of logistic regression. While past research has relied heavily on self-report questionnaire data, this paper utilizes more objective data from a recent government industrial census in China telecommunication equipment industry to test the issue. These data provide samples from the same industry and offers a sample size much larger than typically employed in the past. To further favor the above conclusion, the third chapter of this article gives a mathematical model. Then,this article hypothesizes that firm resources will moderate the relationship between the timing of entry and firm performance. Empirical analyses of data from a sample of multi-national enterprises competing in China show evidence supporting the hypotheses. This paper suggests: first, the so-called first-mover advantages are contingent upon many firm resources, Without consideration of the differences in firm resources, it would be difficult for one to really understand the effects of first-mover strategy or early entry strategy; second, the controlling environmental or situational factors in testing first-mover advantages is very important. Past research has pointed out that the valuable resources or the capabilities of firms are industry-specific. This study has obtained evidence supporting this argument; third, for practitioners, when making decisions on the timing of entry, managers should consider firm resources as well as environmental factors. The conclusions of this paper supply the first-mover advantages based on the resources-based view of firm with a new argument.