Internationalization - selection, expansion, entry Flashcards
Explain the three strategy processes of internationalization (approaches to market selection)
o A systematic approach, using a formalized decision process including various statistical methods to analyse the potential of target markets
• How a decision should be made
o An unsystematic approach, suggesting the use of rules of thumbs such as selection of those foreign markets that minimize the perceived psychic distance.
• Learning by doing – Uppsala model
o Thid approach in this article – the relationship approach
of Andersen & Buvik (2002)
define and explain objective- and experimental knowledge
objekctive = can be transferred and thought learning = only learned through personal experience
Virtually trap - explain this term
virtual experience = insight knowledge about customer connections
non virtual experiences = insight knowledge not the market connections
explain some value based reasons for internationalization
- furthermore give som examples of arbitrage benefits
scale benefits, arbitrage benefits, competitive pressures
benefits for arbitrage:
- tax
- flexibility
- risk reduction
explain maybe draw
- economic of scale
- economic of scope
- transaction cost
- Discuss the answers
explain the different models and their function (in relation to M/P) - positive negative inverted u shape u shaped sigmoid
see slides lecture 10
Define the shower/waterfall approach and link them to the terms diversification/concentration
see slide lecture 12
what are the market expansion strategies?
diversification, concentartion
define concentration and diversification and mention the author of the strategies
Ayal and Ziff (1979)
concentration = slow and gradual rate of growth
diversification = fast rate of groth regarding the markets served
Explain, draw and link the establishment chain’s relevans for the market expansion
see slide lecture 12
explain terms depth and breadth
D = depth of the respective business in the country
B = breadth of the respective MNE in the country
Define the three alternative selection strategies for market entry mode
naive rule, pragmatic rule, strategic rule.
name the two types of entry mode, and mention som advantages and disadvantages of the two
non-equity based mode & equity based mode
Who is the author of the equity-, and non equity based entry modes?
Pan Y (2000)
What is a joint venture?
A contractual partnership between two parties. They form a joint-venture company where they equally share the capital etc.
