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Internationalisation by Business Services: A Methodological Critique of Foreign-Market Entry-Mode Choice

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  • P N O'Farrell
  • L Moffat
  • P A Wood

    (Faculty of Economic and Social Studies, Heriot-Watt University, Riccarton, Edinburgh EH14 4AT, Scotland)

Abstract

In this paper the work of geographers, economists, and management scientists in studying interregional and international expansion by service companies is reviewed. A critique is presented of some of the fundamental methodological problems inherent in analysing foreign-market entry-mode choice. These are particularly apparent when studying the process of business service-sector internationalisation. Issues discussed include inconsistencies in the definition of which entry decision to analyse; the level of aggregation to adopt when modelling mode choice; mode choice and cooperative organisational networks; different approaches to measuring cultural distance and country risk; and the methodologies used to develop scales to represent the constructs relevant to internationalisation.

Suggested Citation

  • P N O'Farrell & L Moffat & P A Wood, 1995. "Internationalisation by Business Services: A Methodological Critique of Foreign-Market Entry-Mode Choice," Environment and Planning A, , vol. 27(5), pages 683-697, May.
    • Handle: RePEc:sae:envira:v:27:y:1995:i:5:p:683-697
    DOI: 10.1068/a270683
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    References listed on IDEAS

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    1. Gatignon, Hubert & Anderson, Erin, 1988. "The Multinational Corporation's Degree of Control over Foreign Subsidiaries: An Empirical Test of a Transaction Cost Explanation," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 4(2), pages 305-336, Fall.
    2. W H Davidson & Donald G McFetridge, 1985. "Key Characteristics in the Choice of International Technology Transfer Mode," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 16(2), pages 5-21, June.
    3. Sanjeev Agarwal & Sridhar N Ramaswami, 1992. "Choice of Foreign Market Entry Mode: Impact of Ownership, Location and Internationalization Factors," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 23(1), pages 1-27, March.
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    Cited by:

    1. R B McNaughton, 1999. "Transaction Cost Analysis and the Methodology of Foreign-Market Entry-Mode Studies," Environment and Planning A, , vol. 31(4), pages 575-596, April.

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