Does prior experience really pay? Foreign direct investment, institutional environments, and firm performance

My dissertation provides an in-depth re-examination of the FDI conventional wisdom which suggests prior experience with foreign investment leads to subsequent performance improvements. I challenge this theoretical view as I find that often experienced firms fail. I conjecture that prior FDI experience can have both positive and negative impacts on firm performance, given the level of similarity to the target country's institutional environment. By utilizing field studies on telecommunications regulation, executive interviews (conducted in Brazil, Spain, Portugal and the USA) and a uniquely constructed FDI dataset, I develop an information acquisition theoretical framework to explain the mechanisms of prior experience that drive performance. Experience is operationalized as the dimensions of the institutional environment (i.e., regulation, corporate ownership structure) in a firm's home and/or host country participation. I contextualize the impact of firms' prior experience by examining foreign investment into the Brazilian telecommunications industry from 1997--2004. This dissertation work and future research extensions aim to contribute to the broader understanding of multinational firms' institutional experiences and the direct impacts on firm performance.