1. ¹Sir John Cass Business School, City University, London, UK
2. ²Halle Institute for Economic Research, Halle (Saale), Germany

Correspondence: I Filatotchev, Sir John Cass Business School, City University London, 106 Bunhill Row, London EC1Y 8TZ, UK. Tel: +44 (0)20 7040 5278; Fax: +44 (0)20 7040 8328; E-mail: igor.filatotchev@city.ac.uk

Received 13 January 2006; Revised 2 February 2007; Accepted 23 August 2007; Published online 22 May 2008.

Abstract

This paper examines the relationships between foreign ownership, managers' independence in decision-making and exporting of foreign-invested firms in five European Union accession countries. Using a unique, hand-collected data set of 434 foreign-invested firms in Poland, Hungary, Slovenia, Slovakia and Estonia, we show that foreign investors' ownership and control over strategic decisions are positively associated with export intensity, measured as the proportion of exports to total sales. The study also analyzes specific governance and control configurations in foreign-invested firms, showing that foreign equity and foreign control over business functions are complementary in terms of their effects on export intensity.