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Foreign divestments from Russia: An exploration of the mediating factors
Author(s) -
Panibratov Andrei,
Brown Tashauna
Publication year - 2018
Publication title -
strategic change
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.527
H-Index - 16
eISSN - 1099-1697
pISSN - 1086-1718
DOI - 10.1002/jsc.2208
Subject(s) - divestment , profitability index , business , bounded rationality , industrial organization , rationality , key (lock) , marketing , economics , microeconomics , finance , computer science , law , computer security , political science
Foreign divestment (FD) decisions are not purely based on the profitability of a business but also on a company's investing and divesting experience and the degree of uncertainty in markets. The FD procedure is grounded by the level of uncertainty, experience in divesting, and experience in investing. Both internal and external factors are catalysts for the firms’ foreign divestments. The constructs of real options theory, prospect theory and the theory of bounded rationality are three key moderators in the firms’ FD decision‐making.