Institutions, Transaction Costs, and Entry Mode Choice in Eastern Europe

By K. Meyer. Multinational Enterprises and Emerging Economies, 2001

294 citations recorded by the source corpus.

The process of change from a centrally planned system to a market economy generates an institutional framework that is only partially reformed, and therefore inconsistent and unstable. This leads to high transaction costs for economic agents. Multinational enterprises entering transition countries have to adapt their strategies to the local institutions and reduce exposure to highly imperfect markets. This paper analyzes how the costs of organizing business in transition environments influence entry mode choice. The empirical results show that host country institutions in transition economies, have an impact on the choice of entry modes. Moreover, different mechanisms determine the internalization of managerial and technological knowledge.

View Paper: https://www.semanticscholar.org/paper/2709966931e3e41fe2ffb3e3b5605f7718396329

How researchers see this paper

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1. S. Bhaumik
2. Mike W. Peng
3. Yuan Ding
4. Hua Zhang
5. Jing Li
6. K. Meyer
7. Yuan Li
8. Sunny Li Sun

Citations in the corpus

• Overcoming distrust: How state-owned enterprises adapt their foreign entries to institutional pressures abroad (2014, background): “…institutional pressures induce SO MNEs to show more local adaptation than PO MNEs in terms of both their establishment mode (acquisition or greenfield) (Hennart & Park, 1993, Slangen & Hennart, 2007) and the level of control over the foreign operation (Brouthers, 2002, 2013, Meyer, 2001).”
• Institutions, Resources, and Entry Strategies in Emerging Economies (2020, background): “However, the need for a partner may decline with the strengthening of the institutional framework (Meyer, 2001; Peng, 2003; Steensma et al ., 2005).”