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Country Distance and Entry Mode Choice of MNEs in Vietnam’s Agricultural Sector in Context of Free Trade

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  • Nguyet Nguyen

    (Business Administration Faculty, Thuongmai University, Hanoi 100000, Vietnam)

  • Ha Thi Hoang Tran

    (Business Administration Faculty, Thuongmai University, Hanoi 100000, Vietnam)

  • Tuan Duong Vu

    (Business Administration Faculty, Thuongmai University, Hanoi 100000, Vietnam)

Abstract

In this article, we focus on tackling a relative research gap: how country distance (institutional, cultural, economic, and geographical distance) determines the entry mode choice between wholly-owned enterprises (WOEs) and joint venture enterprises (JVEs) in the context of “going global”. Based on a sample of 439 multinational enterprises (MNEs) from 22 different nations that directly invested in the agricultural sector of Vietnam in the period 1996–2019, an empirical investigation has been conducted by employing logistic regression. The results show that as cultural and geographical distances increase, MNEs prefer JVE forms. However, WOE becomes more popular in cases of large economic and institutional distance. Furthermore, entry mode choices of MNEs are also noticeably impacted by freedom of trade.

Suggested Citation

  • Nguyet Nguyen & Ha Thi Hoang Tran & Tuan Duong Vu, 2022. "Country Distance and Entry Mode Choice of MNEs in Vietnam’s Agricultural Sector in Context of Free Trade," Sustainability, MDPI, vol. 14(6), pages 1-16, March.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:6:p:3164-:d:766430
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