Business and Economic Horizons

  Previous Article | Back to Volume | Next Article
  Abstract | References | Citation | Download | Preview | Statistics
Volume 10
Issue 1
Online publication date 2014-04-22
Title Psychic and geographic distance in the process of firm internationalization. Example of companies from Poland and Lodz region
Author Agnieszka Kłysik-Uryszek, Anetta Kuna-Marszałek
Abstract
Internationalisation of firms has been described in many theoretical concepts, among which the Uppsala model is the most widely used. It focuses on the sequence of the process in terms of both forms and directions of internationalisation. The need to gradually advance in internationalisation and the choice of foreign markets are explained by the concept of „psychic distance”, which results, among the others, from cultural differences or business practices of the home and host country. Our paper makes an attempt to answer the question whether Polish firms which enter the path of internationalisation start to invest in one or a few neighbouring countries rather than investing in distant markets and/or several markets simultaneously. The idea is analysed using the example of firms based in Poland and in the Lodz Region involved in foreign direct investment.
The paper has been divided into 3 parts. The first one reviews the literature on internationalization models, with particular stress on the Uppsala model; the second part validates the main assumptions of the model using data concerning firms from Poland and the third part focuses on foreign operations of companies from the Lodz Region.  

Citation
References
Agarwal, S., 1994. “Socio-cultural distance and the choice of joint ventures: a contingency perspective”, Journal of International Marketing, 2 (2), pp.63-80

Barkema H.G., Bell, John H.J., Pennings, J.M., 1996. “Foreign Entry, Cultural Barriers, and Learning”, Strategic Management Journal, 17 (2), pp.151-66, http://dx.doi.org/10.1002/(SICI) 1097-0266(199602)17:2<151::AID-SMJ799>3.0.CO;2-Z

Beckerman, W., 1956. “Distance and the Pattern of Intra-European Trade”, The Review of Economics and Statistics, 38, pp.31-40, http://dx.doi.org/10.2307/1925556

Benito, G., Gripsrud G., 1992. “The expansion of foreign direct investments: Discrete rational location choices or a cultural learning process?”, Journal of International Business Studies, 23, pp.461-476, http://dx.doi.org/10.1057/palgrave.jibs.8490275

Bilkey, W.J., Tesar G., 1977. “The Export Behavior of Smaller Wisconsin Manufacturing Firms”, Journal of International Business Studies, (Spring/Summer), pp.93-98, http://dx.doi.org/10.1057/palgrave.jibs.8490783

Brouthers, K.D., Brouthers, L.E., 2000. “Acquisition or greenfield startup? Institutional, cultural and transaction cost influences”, Strategic Management Journal, 21(1), pp.89-97, http://dx.doi.org/10.1002/(SICI)1097-0266(200001)21:1<89::AID-SMJ85>3.0.CO;2-8

Calof, J., Beamish, P.W., 1995. “Adapting to foreign markets: explaining internationalization”, International Business Review, 4(2), pp.115-131, http://dx.doi.org/10.1016/0969-5931(95)00001-G

Cavusgil, S.T., 1980. “On the internationalization process of firms”, European Research. 8(6), pp.273-281

Cavusgil, S.T., Knight, G., 2009. “Born Global Firms: A New International Enterprise”, New York: Business Expert Press, http://dx.doi.org/10.4128/9781606490136

Czinkota, M.R., 1982. “Export development strategies: US promotion Policy”, New York: Praeger
Dikova, D., 2009. “Performance of foreign subsidiaries: Does psychic distance matter?”, International Business Review, 18(1), pp.38-49, http://dx.doi.org/10.1016/j.ibusrev.2008.11.001

Dunning, J.H., 1981. “International Production and the Multinational Enterprise”, London: George Allen and Unwin

Dunning J.H., 1988. “Location and the Multinational Enterprise; A Neglected Factor?”, Journal of International Business Studies, 29(1), pp.45-66, http://dx.doi.org/10.1057/palgrave.jibs.8490024

Dunning, J.H., 1995. “Trade, Location of Economic Activity and The Multinational Enterprise: A search for an eclectic approach”, in: “Readings in International Enterprise”, Drew P. (ed.), London, pp.250-274

Eriksson, K., Majkgård, A., Sharma, D.D., 2000. “Path dependence in the internationalization process”, Management International Review, 40(4), pp.307-328

Evans, J., Mavondo, F.T., 2002. “Psychic Distance and Organizational Performance: An Empirical Examination of International Retailing Operations”, Journal of International Business Studies, 33(3), pp.515-532, http://dx.doi.org/10.1057/palgrave.jibs.8491029

Freeman, S., Edwards R., & Schroder B., 2006. “How Smaller Born-Global Firms Use Networks and Alliances to Overcome Constraints to Rapid Internationalization”, Journal of International Marketing, 14(3), pp.33-63, http://dx.doi.org/10.1509/jimk.14.3.33

Gorynia, M., Jankowska, B., 2007. “Teorie internacjonalizacji”, Gospodarka Narodowa, 10, pp.21-44

Hashai, N., Almor, T., 2004. “Gradually internationalizing 'born global' firms: an oxymoron?”, International Business Review, 13(4), pp.465-483, http://dx.doi.org/10.1016/j.ibusrev.2004.04.004

Hofstede, G., 1980. “Culture's Consequences: International Differences in Work-Related Attitudes”, Beverely Hills: Sage Publications

Hofstede, G., 2001. “Culture's Consequences: Comparing values, behaviors, institutions, and organizations across nations”, Thousand Oaks, California: Sage Publications.

Johanson, I., Vahlne, I., 1990. “The Mechanism of Internationalization”, International Marketing Review, 7(4), pp.11-24, http://dx.doi.org/10.1108/02651339010137414

Johanson, J., Mattson, L.G., 1988. “Internationalization in industrial systems - A network approach. in: “Industrial networks: A new view of reality”, Axellson, B., Easton, G. (eds.). London: Routledge

Johanson, J., Mattsson, L.-G., 1993. “Internationalization in industrial systems - a network approach, strategies in global competition”. in: “The Internationalization of the Firm: A Reader”, Buckley, P.N., Ghauri, P.J. (eds.). London: Academic Press

Johanson, J., Vahlne, J.E., 1977. “The internationalization process of the firm - A model of knowledge development and increasing market commitments”, Journal of International Business Studies, 8(1), pp.23-32, http://dx.doi.org/10.1057/palgrave.jibs.8490676

Johanson, J., Wiedersheim-Paul, F., 1975. “The Internationalization of the Firm - Four Swedish Cases”, The Journal of Management Studies, 12(3), pp.305-323, http://dx.doi.org/10.1111/j.1467-6486.1975.tb00514.x

Knight, G.A., Cavusgil, S.T., 1996. “The Born Global Firm: A Challenge to Traditional Internationalization Theory”, Advances in International Marketing, 8, pp.11-26

Kogut, B., Singh H., 1988. “The Effect of National Culture on the Choice of Entry Mode”, Journal of International Business Studies, 19 (3), pp.411-32, http://dx.doi.org/10.1057/ palgrave.jibs.8490394

Lee, D.J., 1998. “Developing International Strategic Alliances between Exporters and Importers: The Case of Australian Exporters”, International Journal of Research in Marketing, 15(4), pp.335-348, http://dx.doi.org/10.1016/S0167-8116(98)00010-X

Melin, L., 1992. “Internationalization as a strategy process”, Strategic Management Journal, 13, pp.99-118, http://dx.doi.org/10.1002/smj.4250130908

Möller, K., Rajala, A., 2007. “Rise of strategic nets — New modes of value creation”, Industrial Marketing Management, 36, pp.895-908, http://dx.doi.org/10.1016/j.indmarman.2007.05.016

Ng, S.I., Zain, M., 2006. “The Impacts of Network Relationships on SMEs' Internationalization Process”, Thunderbird International Business Review, 48(2), pp.183-205, http://dx.doi.org/10.1002/tie.20092

O'Grady, S.O., Lane, H.W., 1996. “The Psychic Distance Paradox”, Journal of International Business Studies, 27(2), pp.309-333, http://dx.doi.org/10.1057/palgrave.jibs.8490137

Pothukuchi, V. et al., 2002. “National and Organizational Culture Differences and International Joint Venture Performance”, Journal of International Business Studies, 33 (2), pp.243-65
http://dx.doi.org/10.1057/palgrave.jibs.8491015

Przybylska, K., 2009. “Znaczenie dystansu psychicznego w procesie internacjonalizacji polskich przedsiębiorstw”, in: Przedsiębiorczość jako niewykorzystane źródło sukcesu polskiej gospodarki”, Okoń-Horodyńska, E. (ed.), Warszawa: PTE

Reid, S., 1983. “Firm Internationalization, Transaction Costs And Strategic Choice”. International Marketing Review, 1(2), pp.44-56, http://dx.doi.org/10.1108/eb008251

Reid, S.D., 1981. “The decision-market and export entry and expansion”, Journal of International Business Studies, 12(2), pp.101-112, http://dx.doi.org/10.1057/palgrave.jibs.8490581

Rennie, M.W., 1993. “Global competitiveness: Born global”, McKinsey Quarterly, Vol.4, pp.45-52

Sousa, C.M., Bradley F., 2006. “Cultural Distance and Psychic Distance: Two Peas in a Pod”, Jour¬nal of International Marketing. 14(1), pp.79-90

Sullivan, D., Bauerschmidt, A., 1990. “Incremental internationalization: a test of Johanson and Vahlne's thesis”, Management International Review, 30(1), pp.19-30

Turnbull, P.W., 1987. “A Challenge to the Stages Theory of the Internationalization Process”, in: “Managing Export Entry and Expansion”, Rosson, P.J., Reid, S.D. (ed.), New York: Praeger

Vahlne, J-E., Nordstrom, K.A., 1990. Is the Globe Shrinking? Psychic Distance and the Establishment of Swedish Sales Subsidiaries During the Last 100 Years”, EIBA Conference. Stockholm

Welch, L.S., Luostarinen, R.K., 1988. “Internationalization: Evolution of a Concept”, Journal of General Management, 14 (2), pp.36-64

Wind, Y., Douglas, S.P., & Perlmutter H.V., 1973. “Guidelines for Developing International Marketing Strategies”, Journal of Marketing, 37, pp.14-23, http://dx.doi.org/10.2307/1250046

Zhou, L., Wu, W., & Luo, X., 2007. Internationalization and the Performance of Born Global SMEs: The Mediating Role of Social Networks”, Journal of International Business Studies, 38 (4), pp.673-690, http://dx.doi.org/10.1057/palgrave.jibs.8400282

Keywords Firm internationalization, Uppsala model, foreign direct investment
DOI http://dx.doi.org/10.15208/beh.2014.01
Pages 1-9
Download Full PDF Download
  Previous Article | Back to Volume | Next Article
Share
Search in articles
Statistics
Journal Published articles
BEH 558
Journal Hits
BEH 1132017
Journal Downloads
BEH 41253
Total users online -