The choice of equity entry modes in developing countries with a modified eclectic perspective: a case of China

The choice of equity entry mode is one of the most popular subjects or topics in international business. Previous studies suggest that there are three frameworks and a large number of variables to examine the choice of entry mode. In general, the entry mode can be divided into two different types in terms of the degree of equity involvement. Few studies have examined and investigated the choice of equity entry mode in emerging markets so far. This paper provides four propositions to modify the existing eclectic frameworks and enrich the variables associated with those frameworks using the case of China. This paper also proposes that game theory should be incorporated into the choice of entry mode because of dynamically competitive environments.