The trade-off between institutionally proximal and distal markets: The impact of home market pressures on firms’ export market selection

Autor: Ming-Chang Huang, Hsiang-Lin Cheng
Rok vydání: 2019
Předmět:
Zdroj: Industrial Marketing Management. 76:98-108
ISSN: 0019-8501
DOI: 10.1016/j.indmarman.2018.08.005
Popis: This study uses an organizational change perspective to analyze firms' export market selection (EMS) to adapt to home country market pressures. We argue that firms' strategic objectives influence whether they will enter institutionally proximal or distal markets. A model with two curvilinear (U-shaped and inverted U-shaped) relationships is found by testing 1940 Taiwanese export firms based on two official datasets. The model shows that firms are more likely to increase their exports to institutionally proximal markets and to decrease their exports to institutionally distal markets if they have an increasing but still controllable degree of competitive and marketing pressures in the home country. This response represents an incremental change by exporting firms. However, firms increase their exports to institutionally distal markets while decreasing their exports to institutionally proximal markets if they have an excessively increasing degree of competitive and marketing pressures in the home country. This response represents a radical change by exporting firms. We find that export firms' strategic objectives in choosing different organizational change styles (incremental or radical) are highly related to this trade-off in their EMS decision making.
Databáze: OpenAIRE
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