Ownership control of foreign affiliates: A property rights theory perspective

Nigel Driffield, Tomasz Mickiewicz, Yama Temouri

    Research output: Contribution to journalArticlepeer-review

    31 Scopus citations


    This paper applies property rights theory to explain changes in foreign affiliates’ ownership. Post-entry ownership change is driven by both firm-level characteristics and by the differences in the institutional environments in host countries. We distinguish between financial market development and the level of corruption as two different institutional dimensions, such that changes along these dimensions impact upon ownership change in different ways. Furthermore, we argue that changes in ownership are affected by the foreign affiliate's relatedness with its parent's sector, as well as by the affiliate's maturity. We use firm level data across 125 host countries to test our hypotheses.

    Original languageBritish English
    Pages (from-to)965-976
    Number of pages12
    JournalJournal of World Business
    Issue number6
    StatePublished - 1 Nov 2016


    • Corruption
    • Financial markets
    • Foreign direct investment
    • Incomplete contracts
    • Ownership
    • Ownership change
    • Property rights theory


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