| Studies undertaken by international business scholars on the issue of modal choice have usually considered alliances (or other non-equity agreements) and investment to be mutually exclusive choices. For the purposes of market entry this may be a suitable argument. Based on ownership, location and internalization specific factors, a firm will choose one modality versus the other. However if we consider a wide range of firm motives for cross border involvement—i.e., we include efficiency seeking, resource seeking and asset seeking investments to the market seeking ones—then it is seen that the firm does not restrict itself to just one mode in a given foreign location. This thesis argues that a firm takes on multiple arrangements, sometimes in the same market, for different activities along the value chain—and these choices are conditioned by the firm's motives for investment and strategic objective with respect to that particular value added activity. Thus, cross border involvement of a firm will be a nexus of treaties, with a myriad of relationships with other firms—some involving equity and others not.; Secondly, ownership advantages of a firm are generally treated as a determinant of fdi. This thesis determines which ownership advantages are most important for a shipping firm; it also tries to sort different types of Oa and Ot advantages (Dunning, 1993) and predicts some will lead to a propensity to invest, while others will lead to the formation of alliances.; Third, we test some of the csf's (critical success factors) and determinants of alliances that have been put forward in the literature, such as prior experience, similarity of size between partners, trust based on a time and market conditions—in the industry under question. We hypothesize the above to be of significance in the conclusion and the success of alliances.; Fourth we examine the extent to which e-commerce has changed foreign investment decisions of ocean shipping firms, in terms of their choices of investment locations, mode of entry or the value added to their firm's competitive advantage.; Fifth, this thesis also determines the degree of transnationality of the container shipping industry, and uses this measure as an indicator of fdi to test the various hypotheses developed in the thesis. |
