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How does distance affect market entry mode choice? Evidence from French companies

Author

Listed:
  • Emna Moalla

    (ESSCA - Ecole Supérieure des Sciences Commerciales d'Angers)

  • Ulrike Mayrhofer

    (GRM - Groupe de Recherche en Management - EA 4711 - UNS - Université Nice Sophia Antipolis (1965 - 2019) - UniCA - Université Côte d'Azur)

Abstract

The objective of this article is to examine the relevant dimensions of distance for foreign market entry mode choice. Based on a sample of 203 interfirm linkages formed by French multinationals with partners across the world, we analyze the impact of four dimensions of distance on the choice between cooperative alliances and mergers-acquisitions. The findings indicate that administrative and economic distance have a significant influence on market entry mode choice, whereas the impact of cultural and geographic distance is not significant. They further highlight the important role of the host country's government effectiveness for market entry mode decisions.

Suggested Citation

  • Emna Moalla & Ulrike Mayrhofer, 2020. "How does distance affect market entry mode choice? Evidence from French companies," Post-Print hal-02273279, HAL.
    • Handle: RePEc:hal:journl:hal-02273279
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    7. Fonfara Krzysztof & Hauke-Lopes Aleksandra & Soniewicki Marcin, 2021. "Does Psychic Distance Still Matter? Empirical Evidence from Poland," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 29(4), pages 32-56, December.

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