Is psychic distance still relevant for internationalization decisions?
DOI:
https://doi.org/10.7213/rebrae.v12i1.24654Keywords:
Psychic distance, Internationalization strategy, Brazil, Emergent country.Abstract
Psychic distance has been considered for decades as one of the main drivers of companies’ internationalization decisions. However, changes in the competitive environment caused by the accelerated diffusion of information technologies and increased global integration has led us to reconsider whether this concept remains useful to managers. This study aimed to identify the determinants of psychic distance and the strength of their influence in decision-making during the internationalization process of firms. Following Brewer’s (2007) work, which analyzed the key concepts and ideas about psychic distance from 1996 to 2006, we extended the analyzed period, considering published articles from 2007 up to 2014. From the composition of both periods, we set up the main factors updated. Additionally, we conducted a survey with 35 companies in order to validate research findings. Results show that, as economic factors gain more relevance in market analysis, cultural factors have significantly lost importance as the key drivers of internationalization decisions.
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