Entry timing and performance under uncertainty: Taiwanese firms investing in China

This study makes a contribution to the understanding of the "when-to-make FDI" issue in the context of Asian countries. This paper relates the timing of foreign direct investment (FDI) to firm-specific and environmental factors, and examines the relationship between entry timing and performance. The findings are helpful to build more general FDI theories. This study shows that, facing environmental uncertainty in host countries, firm size, R&D intensity and type of industry are associated with entry timing. This is in line with the arguments that firms with advantages act early. Besides, firms entering a market with low growth potential are more likely to be fast follower compared to the first entrant. In addition, entry timing is positively associated with performance, suggesting that early entrants tend to have better performance in uncertain environments.