Psychic Distance and Internationalization: Evidence from Hong Kong Firms

This paper evaluates and suggests refinements to the concept of psychic distance, assisted by evidence from studies of Hong Kong firms. The concept, when lodged in the analytical framework of distance-creating, distance-compressing, and distance-bridging factors, carriers significant exploratory val...

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Bibliographic Details
Published inInternational studies of management & organization Vol. 32; no. 1; pp. 36 - 56
Main Authors Child, John, Ng, Sek Hong, Wong, Christine
Format Journal Article
LanguageEnglish
Published Abingdon Routledge 01.04.2002
M. E. Sharpe
Taylor & Francis Ltd
Subjects
Banks
Business
Business management
Business structures
Chinese culture
Financial investments
Foreign investment
Globalization
International trade
Investment strategies
Management theory
Psychic distance
Studies
Subsidiary companies
Hong Kong China
China
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Summary:This paper evaluates and suggests refinements to the concept of psychic distance, assisted by evidence from studies of Hong Kong firms. The concept, when lodged in the analytical framework of distance-creating, distance-compressing, and distance-bridging factors, carriers significant exploratory value for the internationalization pattern of the Hong Kong firms. Their internationalization tended to follow a pattern of moving outward across concentric circles of investment destinations that accord with their psychic distance from Hong Kong. The cases also suggest that national culture has previously been over-emphasized as a determinant of psychic distance. They also further reveal that some Hong Kong firms have based their choice of international location more on where the Hong Kong market has expanded, mostly as a result of the migration tide, than on psychic distance.
ISSN:0020-8825
1558-0911
DOI:10.1080/00208825.2002.11043656