Liability of Foreignness: Product Distance, Institutional Distance and FDI

Alyson, C.; Ratcliff, Ryan

doi:10.1080/13571516.2019.1651152

Cited by 5 publications

(3 citation statements)

References 57 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Zaheer (1995) defined this disadvantage as the 'Liability of Foreignness'. The costs of doing business abroad due to foreignness liability were mainly made up of the differences of institution, culture, economics and geographic distance (Eden and Miller, 2004;Ma and Ratcliff, 2020;Zheng et al, 2020). Of these costs, geographic distance primarily besought explicit costs (Li et al, 2020).…”

Section: The Hindering Effect Of Institutional Distancementioning

confidence: 99%

THE IMPACTS OF INSTITUTIONAL DISTANCE ON THE LOCATION OF CHINA’s OUTWARD FOREIGN DIRECT INVESTMENT IN ASEAN: An Empirical Research Based on CAGE Distance Framework

Ye,

Don,

Alam

2023

IJGEM

View full text Add to dashboard Cite

show abstract

Section: The Hindering Effect Of Institutional Distancementioning

confidence: 99%

THE IMPACTS OF INSTITUTIONAL DISTANCE ON THE LOCATION OF CHINA’s OUTWARD FOREIGN DIRECT INVESTMENT IN ASEAN: An Empirical Research Based on CAGE Distance Framework

Ye,

Don,

Alam

2023

IJGEM

View full text Add to dashboard Cite

show abstract

“…Further, setting up foreign subsidiaries incurs start-up costs. Such costs may arise because of institutional imperfections (Bustamante et al, 2021), cultural differences (Brouthers and Brouthers, 2000;Zheng et al, 2020), liability of foreignness (Kostova and Zaheer, 1999;Ma and Ratcliff, 2020;Zaheer, 1995), or lack of prior experience (Eriksson et al, 1997). Thus, in economically similar countries, the costs of setting up and conducting business are likely to outweigh the scope of arbitrage leading to a lower probability of survival in comparison to countries with dissimilar economic conditions.…”

Section: Economic Distance and Foreign Subsidiary Survivalmentioning

confidence: 99%

Revisiting economic distance and its role in foreign subsidiary survival

Arte¹,

Larimo²

2023

EJIM

View full text Add to dashboard Cite

In this study, we argue the coexistence of arbitrage and costs associated with economic distance engender a non-linear relationship between foreign subsidiary survival and economic distance. Specifically, we suggest that low to medium economically distant countries offer scope of economic arbitrage, whereas the cost of operating in medium to high economically distant countries is substantially high. We construct an index of economic distance using arguments from the eclectic paradigm of international production and organisational learning theory and base our measurement on the Mahalanobis method of distance calculation. Empirical analysis is conducted by applying the Cox's proportional hazard model to a sample of 1771 Finnish foreign direct investments. Results suggest that subsidiary survival has an inverted U-shaped relationship with economic distance. Firms with host country experience and wholly owned subsidiaries are able to mitigate the costs of operating in economically distant countries, while joint ventures are better suited for economically similar countries.

show abstract

“…It is also worth adding to the consideration of the following set of economic factors. Firstly, in 2001, fertility over mortality has been projected in Russia [12], secondly, the ongoing economic crisis [13][14][15] caused by US sanctions and other forms of influence on the Russian economy, thirdly, every year there is a substantial number of migrants from the countries of the Near Abroad [16] who are ready to work for a lower salary [16], which also does not increase the average salary in the regions of the country [16]. Together, all this will entail a reduction in jobs, which will complicate the job search for graduates.…”

mentioning

confidence: 99%

Going to Business or Intending in Science?

Rogulin

2020

jour

View full text Add to dashboard Cite

This paper discusses the urgent problem of Russian graduates: job search after graduation. It is shown that, in connection with the growing population of the country due to migrants, the arrival of cheap labor from neighboring countries and other economic factors, the search for a decent job as a graduate remains a difficult and relevant problem in modern Russia. The result of this study can be considered as follows. It is shown that there is the possibility of decent earnings in the scientific field of activity when working with students. A mathematical model and an algorithm for simulating the demonstrated situation are developed. It is shown when a graduate should start searching for additional income and when he can catch up with the total amount of money paid if he went to work in a commercial company. This research is purely theoretical.

show abstract

Liability of Foreignness: Product Distance, Institutional Distance and FDI

Cited by 5 publications

References 57 publications

THE IMPACTS OF INSTITUTIONAL DISTANCE ON THE LOCATION OF CHINA’s OUTWARD FOREIGN DIRECT INVESTMENT IN ASEAN: An Empirical Research Based on CAGE Distance Framework

THE IMPACTS OF INSTITUTIONAL DISTANCE ON THE LOCATION OF CHINA’s OUTWARD FOREIGN DIRECT INVESTMENT IN ASEAN: An Empirical Research Based on CAGE Distance Framework

Revisiting economic distance and its role in foreign subsidiary survival

Going to Business or Intending in Science?

Contact Info

Product

Resources

About