![Joint Venture Advantages Access to partner’s local knowledge Reduction of concern about overpayment Both parties have some performance incentives Significant control over operation Disadvantages Potential loss of proprietary knowledge Potential conflicts between partners Neither partner has full performance incentive Neither partner has full control When Is a Joint Venture Appropriate? ,[object Object]](data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7)
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Joint venture
- 1. Inputs Share of Profit Joint Venture HOME COUNTRY HOST COUNTRY MNE Local Firm Share of Profit Inputs Joint Venture Company
- 3. Large expected mutual gains in the long-run
- 4. Trade secrets can be walled off