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Market entry mode and performance: capability alignment and institutional moderation

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  • Tobias Pehrsson

Abstract

The selection of mode of entering a foreign market is a key decision in a firm's internationalisation. Building on the resource-based view, this study examines important antecedents of firm's selection of a wholly-owned subsidiary and collaboration with other firms. Based on analysis of empirical data from Swedish manufacturing firms operating on several foreign markets the study found that: 1) greater market orientation (MO) and entrepreneurial orientation (EO) capabilities favour firm's selection of a wholly-owned subsidiary; 2) greater institutional distance between the domestic market and the foreign market favours collaboration with local firms; 3) an entry mode that is aligned with the capabilities and institutional distance is positively associated with firm's performance on the foreign market after the entry phase. Contributions to literature are discussed.

Suggested Citation

  • Tobias Pehrsson, 2015. "Market entry mode and performance: capability alignment and institutional moderation," International Journal of Business and Globalisation, Inderscience Enterprises Ltd, vol. 15(4), pages 508-527.
    • Handle: RePEc:ids:ijbglo:v:15:y:2015:i:4:p:508-527
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    Cited by:

    1. Anders Pehrsson, 2019. "When are innovativeness and responsiveness effective in a foreign market?," Journal of International Entrepreneurship, Springer, vol. 17(1), pages 19-40, March.
    2. William E. Baker & Amir Grinstein & Marcelo G. Perin, 2020. "The Impact of Entrepreneurial Orientation on Foreign Market Entry: the Roles of Marketing Program Adaptation, Cultural Distance, and Unanticipated Events," Journal of International Entrepreneurship, Springer, vol. 18(1), pages 63-91, March.

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