Institutional Distance and the Internationalization Process: The Case of Mobile Operators

tiJournal of International Management 17 (2011) 68–82

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Journal of International Management

Institutional distance and the internationalization process: The case of mobile operators
Nicolai Pogrebnyakov a,⁎, Carleen F. Maitland b a b

Department of International Business and Management, Copenhagen Business School, Frederiksberg 2000, Denmark College of Information Sciences and Technology, The Pennsylvania State University, University Park, PA 16802, United States

a r t i c l e

i n f o

a b s t r a c t
This paper applies the institutional lens to the internationalization process model. It updates the concept of psychic distance in the model with a recently developed, theoretically grounded construct of institutional distance. Institutions are considered simultaneously at the national and industry levels. It also aims to understand whether the internationalization process of service firms is different from the behavior predicted by the model, which was developed for the manufacturing context. We empirically test the model using proportional hazard analysis with 130 instances of entry and presence of mobile operators in Europe and South America over 13 years. Influences of regulative, normative and cognitive institutional aspects were disaggregated and shown to have differing effect on internationalization. This suggests that institutional distance is a viable alternative to other distance measures used in the internationalization process research. The results also indicate that the internationalization behavior of this type of service firms might differ from the staged process predicted by the internationalization process model. © 2011 Elsevier Inc. All rights reserved.

Available online 26 January 2011 Keywords: Internationalization Foreign market entry Institutional distance Mobile operators Survival analysis

1. Introduction The significance of institutions has been highlighted in the different aspects

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