Term
| Institutional factors affecting foreign market entries |
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Definition
-regulatory risks
-trade and investment barriers
-differences in cultures, norms, and values |
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Term
| Location-specific advantages |
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Definition
| the benefits a firm reaps from the features specific to a place |
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Term
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Definition
| clustering of economic activities in certain locations |
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Term
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Definition
| firms look for countries possessing nat resources and related transport and communication infrastructure |
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Term
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Definition
| firms go after countries that have strong demand for their products and services |
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Term
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Definition
| firms look for countries with economies of scale and abundant low cost factors |
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Term
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Definition
| firms target countries and regions with abundant innovative individuals, firms, and universities |
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Term
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Definition
| difference between two cultures along some indentifiable dimensions |
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Term
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Definition
| the extent of similarity or dissimilarity between the regulatory, normative, and cognitive institutions of two countries |
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Term
| Two schools of thought about cultural/institutional distances and foreign entry locations – the stage model and the strategic goals model |
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Definition
Stage model - enter culturally similar countries and gain more confidence to enter other countries
Strategic Goals model - more important to consider strategic goals (market efficiency) rather than culture |
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Term
| First-mover advantages (five examples) |
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Definition
-proprietary, technological leadership
-preemption of scarce resources
-establishing entry barriers
-avoiding clash with dominant firms at home
-relationship with key stakeholders |
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Term
| late-mover advantages (three examples) |
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Definition
-opportunity to free ride on first-mover investments
-resolution of technological and market uncertainty
-first movers difficulty to adapt to market changes |
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Term
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Definition
| amount of resources committed to foreign market entry |
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Term
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Definition
-large scale entries
-small scale entries |
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Term
| non-equity mode and examples |
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Definition
| tends to reflect relatively smaller commitments to overseas markets |
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Term
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Definition
| indicate relatively larger, harder to reverse commitment |
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Term
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Definition
| sales of products made by firms in their home country to customers in other countries |
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Term
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Definition
| way to reach overseas customers by exporting through domestic based export intermediaries |
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Term
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Definition
| clients pay contractors to design and construct new facilities and train personnel |
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Term
| build-operate-transfer (BOT) agreement |
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Definition
| non-equity mode of entry used to build a longer term presence by building and then operating a facility for a period of time before transferring operations to a domestic agency or firm |
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Term
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Definition
| outsourcing agreements in R&D between firms |
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Term
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Definition
| efforts among a number of firms to jointly owned by two or more parent companies |
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Term
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Definition
| new corporate entity created and jointly owned by two or more parent companies |
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Term
| wholly owned subsidiaries (WOS) |
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Definition
| subsidiary located in a foreign country that is entirely owned by the parent multinational |
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Term
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Definition
| building factories and offices from scratch |
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