Do initial characteristics influence IJV longevity? Evidence from the Mediterranean region

The objective of this article is to determine the influence of initial conditions on the longevity of international joint ventures (IJVs) in the context of the Mediterranean region. Three key determinants are examined: ownership structure, number of partners, and establishment mode. The empirical study is based on a sample of 124 IJVs established in Southern and Eastern Mediterranean (SEMED) countries. The statistical analysis shows that the establishment mode has a significant effect on IJV longevity, but that the impact of ownership structure and the number of partners is not significant. In contrast with previous studies, the obtained findings emphasize the importance of the geographic context for this field of research. They also suggest that transaction cost theory does not completely explain the longevity of IJVs located in the SEMED region and that other theories are necessary to complement our understanding of investments in emerging economies.