Uppsala Model

In: Business and Management

Submitted By olga2705
Words 6267
Pages 26
THE INTERNATIONALIZATION PROCESS OF THE
FIRM-A MODEL OF KNOWLEDGE DEVELOPMENT
AND INCREASING FOREIGN MARKET
COMMITMENTS
JAN JOHANSON'
Center of International Business Studies
University of Uppsala
JAN-ERIK VAHLNE'
Institute of International Business
Stockholm School of Economics

Abstract. O n the basis of empirical research, a model of the internationalization process of the firm is developed. The model fccuses on the gradual acquisition, integration and use of knowledge about foreign markets and operations, and on the incrementally increasing commitments to foreign markets. In particular, attention is concentrated on the increasing involvement in the individual foreign country.
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Several studies of international business have indicated that internationalization of the firms is a process in which the firms gradually increase their international involvement. It seems reasonable to assume that, within the frame of economic and business factors, the characteristics of this process influence the pattern and pace of internationalization of firms. In this paper we develop a model of the internationalization process of the firm that focuses on the development of the individual firm, and particularly on its gradual acquisltion, integration, and use of knowledge about foreign markets and operations, and on its successively increasing commitment to foreign markets. The basic assumptions of the model are that lack of such knowledge is an important obstacle to the development of international operations and that the necessary knowledge can be acqulred mainly through operations abroad. This holds forthe two directions of internationalization we distinguish.Jncreasing involvement of the firm in the individual foreign country, and successive establishment of operatlons in new countries. In this…...

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