The purpose of this paper is to develop and test propositions on location and entry mode decision making by foreign direct investors in the Middle East region.
Case study approach, based on in‐depth interviews with decision makers of multinational companies operating in the Middle East.
The results show that foreign investors in the Middle East prefer to maintain the highest level of ownership and control permitted in a country, even in the face of political risk.
Location and entry mode decision making has typically been studied using quantitative methods. This research uses a case study approach and develops a new model of entry mode decision making, demonstrating that experienced foreign investors do not view joint ventures as an effective mechanism to manage political risk, but prefer to keep political risk management in‐house.
