Seminar paper from the year 2014 in the subject Business economics -
Business Management, Corporate Governance, grade: 1,3, FOM Duisburg (FOM
Duisburg), course: Semester 6, language: English, abstract: In spite of
a progressing globalization, characterized by improvements in
communication technologies, the world faces four billion people who live
in poverty, mostly due to underemployment. By building up business
activities in these markets, especially multinational corporations, are
not only able to supply the local consumers with goods, but also create
income potentials, while, at the same time, doing good in an economic
sense. But these markets are often coined with problems, like a lack of
basic infrastruc-ture, which makes entering these markets a long
lasting, expensive and risky process for firms. Goal of this paper is to
illustrate the stages model of internationalization according to
Johanson and Vahlne in detail and evaluate its validation limits, 30
years after its first release, by summing up contemporary and recent
reviews. After a short introduction, the basic principles will be
identified, before pointing out the two fundamental parts of the stages
model. While pointing out these parts, each section of it will be
explained. Following the theoretical background, the limitations of the
stages model, according to critics, will be presented. To conclude this
work, an approach to evaluate the today´s relevance of the model and an
overall conclusion will follow.
