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Foreign-Market Entry Strategies in the European Union

Kyle Stiegert (), Archie Amir Ardalan and Thomas Marsh

Journal of Food Distribution Research, 2006, vol. 37, issue 3, 12

Abstract: This study utilized intra-firm, socio-cultural, geographical-proximity, and political-stability variables to explain bimodal foreign direct investment (FDI) patterns by agri-food and beverage multinational companies into and within the European Union. A logit framework incorporated a unique-count database of firm-level investment patterns from 1987–1998. The results showed the 1992 structural changes under the Maastricht Treaty increased the probability of wholly owned FDI modes such as greenfields and buyouts. The model also found that past modal strategies of firms, language barriers, and exchange-rate volatility all correctly explained modal investment patterns. The results provide important contributions toward understanding modal investment strategies including the role of macroeconomic changes within a custom union.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:ags:jlofdr:7067

DOI: 10.22004/ag.econ.7067

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