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Seoul Journal of Economics - Vol. 12 , No. 3

[ Article ]
Seoul Journal of Economics - Vol. 12, No. 3, pp. 257-269
Abbreviation: SJE
ISSN: 1225-0279 (Print)
Print publication date 31 Aug 1999
Received Mar 1999 Revised Jun 1999

Firm Size, Synergy and Joint Ventures
Indrani Roy Chowdhury ; Prabal Roy Chowdhury
Ph.D Student, ITDD, CSDILE, School of International Studies, Jawaharlal Nehru University, New Delhi 110067, INDIA, Tel: +91-11-6181160 (indranirc@hotmail.com)
Associate Professor, ITDD, CSDILE, School of Inter- national Studies, Jawaharlal Nehru University, New Delhi 110067, INDIA, Tel: +91-11-6107676 (Ext. 2403) (prabalrc@hotmail.com)

JEL Classification: F23, L13


Abstract

We develop a synergy based theory of joint venture formation. We find that an increase in firm size affects the incentive for joint venture formation. Furthermore, firm size also crucially affects the impact of market size on the incentive for joint venture formation. We also perform some interesting welfare analysis.


Acknowledgments

We are indebted to an anonymous referee of this journal for very helpful comments. The responsibility for any errors that remain are, of course, ours alone.


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