Journal of International Business Studies

, Volume 33, Issue 2, pp 203–221

Institutional, Cultural and Transaction Cost Influences on Entry Mode Choice and Performance

  • Keith D. Brouthers

DOI: 10.1057/palgrave.jibs.8491013

Cite this article as:
Brouthers, K. J Int Bus Stud (2002) 33: 203. doi:10.1057/palgrave.jibs.8491013


In this study, we examine foreign market entry mode choice and firm performance for a sample of European Union firms. Examining both financial and non-financial performance measures, we attempt to determine if firms that select their entry mode based on transaction cost, institutional context, and cultural context variables perform better than firms that make other mode choices. We found that mode choice did matter. Firms whose mode choice could be predicted by the extended transaction cost model performed significantly better, on both financial and non-financial measures, than did firms whose mode choice could not be predicted by the extended transaction cost model. Implications for future research are discussed.

Copyright information

© Academy of International Business 2002

Authors and Affiliations

  • Keith D. Brouthers
    • 1
  1. 1.University of East London