Bargaining Power, Management Control, and Performance in United States–China Joint Ventures: A Comparative Case Study

This article reports a comparative case study of four international joint ventures created between the United States and the People’s Republic of China. The findings of this study suggest that the relative bargaining power of potential joint-venture partners significantly contributes to the structural configuration of the joint venture with respect to parent control, and that the structure of management control exercised by the parents affects venture performance. Several informal control mechanisms interacting with formal control structure and influencing performance are identified. The article also investigates the dynamic evolution of joint ventures over time as a result of changes in the environment, adjustments in the parents’ strategies, mutual learning between the partners, and the maturity of the joint venture. Finally, an integrative model is presented and several propositions for future research are offered.