Internationalization Of Firms: The Role Of Institutional Distance On Location And Entry Mode
by Laura Vanoli Parietti /
2017 / English / PDF
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Parietti addresses one of the most important topic scrutinized by
the scholars of International Business. Distance between two
countries is a multidimensional concept, including not only a
geographical dimension but also other dimensions related to the
culture, the administrative, political and economic aspects as
shown by Ghemawat (2001) and its "CAGE" framework, as well as by
Berry et al. (2010) and their nine dimensions of cross-national
distance. In the last decade, Van Tulder (2010) notes that the
research tends to be oriented towards the institutional and
governance distance between countries. Many scholars have
emphasized the role of institutions in the internationalization
process of firms (Cantwell et al., 2010; Dunning and Lundan, 2008;
Van Hoorn and Maseland, 2016). Institutional distance has been used
primarily to explain the location and entry mode choices based on
the concept of "liability of foreignness" introduced by Zaheer
(1995). Nevertheless, previous studies show contradictory results
due to differences in terms of conceptualization and measurement of
institutional distance.
Parietti addresses one of the most important topic scrutinized by
the scholars of International Business. Distance between two
countries is a multidimensional concept, including not only a
geographical dimension but also other dimensions related to the
culture, the administrative, political and economic aspects as
shown by Ghemawat (2001) and its "CAGE" framework, as well as by
Berry et al. (2010) and their nine dimensions of cross-national
distance. In the last decade, Van Tulder (2010) notes that the
research tends to be oriented towards the institutional and
governance distance between countries. Many scholars have
emphasized the role of institutions in the internationalization
process of firms (Cantwell et al., 2010; Dunning and Lundan, 2008;
Van Hoorn and Maseland, 2016). Institutional distance has been used
primarily to explain the location and entry mode choices based on
the concept of "liability of foreignness" introduced by Zaheer
(1995). Nevertheless, previous studies show contradictory results
due to differences in terms of conceptualization and measurement of
institutional distance.
