Distance and Perceptions of Risk in Internationalization Decisions

Sascha Kraus*, Tina Ambos, Felix Eggers, Beate Cesinger

*Corresponding author af dette arbejde

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Abstrakt

This study examines top managers’ risk perceptions in internationalization decisions. 126 CEOs and top managers responsible for internationalization in companies with headquarters in Germany, Switzerland, or Austria took part in our experiment. Applying random utility theory in a conjoint choice experiment enables the measurement of top managers’ preferences for target countries and entry modes. Country-specific measures of geographic, cultural, economic, and political distances serve as covariates to explain country preferences and to quantify the effect on internationalization decisions. Our results show that distance dimensions are the primary drivers of risk assessment, whereas entry-mode choice is secondary. Internationalization may therefore be a hierarchical decision in which managers choose target market (and risk profile) and view entry-mode choice as subordinate to other environmental factors.
OriginalsprogEngelsk
TidsskriftJournal of Business Research
Vol/bind68
Udgave nummer7
Sider (fra-til)1501-1505
Antal sider5
ISSN0148-2963
DOI
StatusUdgivet - jul. 2015
Udgivet eksterntJa

Emneord

  • Internationalization
  • Risk
  • Choice experiment
  • Conjoint analysis
  • Distances

Citationsformater