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Journal of Economic Geography Advance Access originally published online on October 24, 2005
Journal of Economic Geography 2006 6(3):369-393; doi:10.1093/jeg/lbi016
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Right arrow D81 - Criteria for Decision-Making under Risk and Uncertainty
Right arrow F23 - Multinational Firms; International Business
Right arrow L11 - Production, Pricing, and Market Structure; Size Distribution of Firms
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© The Author (2005). Published by Oxford University Press. All rights reserved. For Permissions, please email: journals.permissions@oxfordjournals.org

A relational assessment of international market entry in management consulting

Johannes Glückler*

* Department of Economic and Social Geography, University of Frankfurt, Dantestrasse 9 60325 Frankfurt am Main, Germany. email <glueckler{at}em.uni-frankfurt.de>

This paper criticizes conventional internationalization theory of the firm and argues for a relational perspective in the analysis of international expansion. Using in-depth empirical research from three European metropolitan case studies, the paper demonstrates that social networks (i) are the most frequent cause of international market entry and (ii) they systematically affect the organizational form of entry. A combination of qualitative exploration and logistic regression analysis of fieldwork and survey data suggests that the internationalization of business services cannot be fully understood from firm-specific resources alone, but it also has to take the context of external relationships into systematic consideration. The impact of social networks on entry form changes over time. With increasing international experience firms face fewer constraints on entering a foreign market through brownfield FDI. For economic geography, future analysis should focus more on the context of inter-firm relationships in order to overcome some of the too mechanical arguments about the process of firm internationalization.

Keywords: internationalization theory, entry mode, business network, mixed method, management consulting,
JEL classification: D81, F23, L14, Z13
Date submitted: 14 February 2005     Date accepted: 23 September 2005


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