The Internet And Foreign Market Expansion By Firms
AbstractThe Internet has the potential to improve the efficiency of market transactions. By use of the Internet companies can reduce their search costs significantly and increase their ability to respond flexible to new market opportunities as a result of reduced sunk costs. On the basis of internationalization theory and agency/transaction cost theory the paper examines the effects of the Internet on foreign market expansion by firms. These theoretical issues and possible effects on internationalization are illustrated through the presentation of three general predictions regarding possible outcomes. The predictions demonstrate that a range of foreign expansion effects of the Internet is likely: from limited impact to rapid, widespread global expansion in many cases. The Internet may contain a challenge to mainstream internationalization theory in regard to the role of knowledge: instead of acting as an initial constraint it may be a factor that propels firms into foreign market expansion.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Copenhagen Business School, Department of International Economics and Management in its series Working Papers with number 7-2002.
Length: 28 pages
Date of creation: 01 Jul 2002
Date of revision:
Contact details of provider:
Postal: Department of International Economics and Management, Copenhagen Business School, Howitzvej 60, DK-2000 Frederiksberg, Denmark
Phone: +45 3815 2515
Fax: +45 3815 2500
Web page: http://www.cbs.dk/departments/int/
More information through EDIRC
Internet; Market transactions; Internationalization; market expansions;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-05-18 (All new papers)
- NEP-COM-2003-05-18 (Industrial Competition)
- NEP-MAC-2003-05-18 (Macroeconomics)
- NEP-NET-2003-05-18 (Network Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Akerlof, George A, 1970. "The Market for 'Lemons': Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, MIT Press, vol. 84(3), pages 488-500, August.
- Sullivan, Jeremiah, 1999. "What are the functions of corporate home pages?," Journal of World Business, Elsevier, vol. 34(2), pages 193-210, July.
- Ursic, Michael L. & Czinkota, Michael R., 1984. "An experience curve explanation of export expansion," Journal of Business Research, Elsevier, vol. 12(2), pages 159-168, June.
- Sivadas, Eugene & Grewal, Rajdeep & Kellaris, James, 1998. "The Internet as a Micro Marketing Tool: Targeting Consumers through Preferences Revealed in Music Newsgroup Usage," Journal of Business Research, Elsevier, vol. 41(3), pages 179-186, March.
- Reid, Stan, 1984. "Information acquisition and export entry decisions in small firms," Journal of Business Research, Elsevier, vol. 12(2), pages 141-157, June.
- Robert G Cooper & Elko J Kleinschmidt, 1985. "The Impact of Export Strategy on Export Sales Performance," Journal of International Business Studies, Palgrave Macmillan, vol. 16(1), pages 37-55, March.
- Finn Wiedersheim-Paul & Hans C Olson & Lawrence S Welch, 1978. "Pre-Export Activity: The First step in Internationalization," Journal of International Business Studies, Palgrave Macmillan, vol. 9(1), pages 47-58, March.
- Yamin, Mohammad & Sinkovics, Rudolf R., 2006. "Online internationalisation, psychic distance reduction and the virtuality trap," International Business Review, Elsevier, vol. 15(4), pages 339-360, August.
- Reuber, A. Rebecca & Fischer, Eileen, 2011. "International entrepreneurship in internet-enabled markets," Journal of Business Venturing, Elsevier, vol. 26(6), pages 660-679.
- Loane, S. & Bell, J.D. & McNaughton, R., 2007. "A cross-national study on the impact of management teams on the rapid internationalization of small firms," Journal of World Business, Elsevier, vol. 42(4), pages 489-504, December.
- Petersen, Bent & Welch, Lawrence S., 2002. "International Business Development And The Internet, Post-Hype," Working Papers 8-2002, Copenhagen Business School, Department of International Economics and Management.
- Pezderka, Noemi & Sinkovics, Rudolf R., 2011. "A conceptualization of e-risk perceptions and implications for small firm active online internationalization," International Business Review, Elsevier, vol. 20(4), pages 409-422, August.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Lars Nondal).
If references are entirely missing, you can add them using this form.