Why do firms engage in international market?
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Firms engage in international markets for various reasons, such as accessing new markets, resources, and cost efficiencies. The Uppsala Model suggests firms internationalize gradually to markets with lower psychic distance, relying on experiential knowledge . Knowledge, whether experiential or second-hand, is crucial for successful internationalization . Additionally, firms may imitate others' market selections, either following successful leaders or mimicking a herd, even without superior information . International market entry modes, including export, contractual, and investment modes, offer different levels of risk and control, influencing firms' decisions . Overall, firms aim to achieve long-term competitive advantages in international markets by aligning their strategies with market conditions and available resources .
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| Papers (5) | Insight |
|---|---|
08 Oct 2019 4 Citations | Firms engage in international markets due to motivations like accessing global markets, resources, and strategic sourcing. The interaction of internal resources and external constraints influences their internationalization capability. |
| Firms engage in international markets due to growth opportunities, responding to shocks, and making critical financing decisions, as detailed in the paper "Firms in International Trade." | |
| Firms engage in international markets to maximize profits, expand globally, and make critical financing decisions. They play a vital role in the global economy by selecting into exporting and responding to international shocks. | |
| Firms engage in international markets to access new markets, resources, lower costs, and achieve long-term competitive advantage by aligning strategies with international market conditions and consumer preferences. | |
01 Jan 2021 1 Citations | Firms engage in international markets to gradually expand based on experiential or second-hand knowledge, or through mimicking successful firms or a herd, rather than systematic selection processes. |
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