Vahlne, J. E. (2020)

Question 1

Uppsala Model (1977)

Answer 1

The original model explaining how firms internationalize incrementally through experiential learningand market commitment to reduce uncertainty.

Key Elements:

State Variables → Market Knowledge & Market Commitment
Change Variables→ Commitment Decisions & Current Activities

Question 2

What is something that a companies consider when expanding?

Answer 2

Psychic Distance

🔹 Definition: The perceived gap between countries in terms of culture, language, regulations, and business practices, influencing the order of market entry.
🔹 Key Idea: Firms start in culturally familiar markets before expanding to distant ones.

Question 3

Liability of Foreignness

Answer 3

The additional costs and risks firms face when entering a foreign market due to lack of local knowledge and legitimacy.

Question 4

Uppsala Model (2009) What was the main update for the Model?

Answer 4

Network View
🔹 Definition: Firms internationalize through business networks rather than just individual learning.
🔹 Key Changes:

Liability of Outsidership → Not being part of local networks is a major barrier.
- Trust-building & relationships are critical for success.

Question 5

Liability of Outsidership

Answer 5

The disadvantage of not being embedded in local networks, making it harder to access resources and opportunities.

Question 6

Uppsala Model (2017) What the main Idea of this model

Answer 6

Evolutionary Perspective
🔹 Definition: The model now explains firm evolution, not just internationalization, by incorporating capabilities and dynamic learning.
🔹 Key Changes:

• Firms evolve based on knowledge, experience, and capability-building.
• Internationalization is part of a larger business transformation.

Question 7

Dynamic Capabilities

Answer 7

A firm’s ability to adapt, learn, and develop new skills to stay competitive internationally.
🔹 Key Idea: Firms must evolve to sustain long-term growth.

Question 8

What is the main point of the uppsala model?

Answer 8

The Uppsala Model doesn’t define what internationalization is, but rather explains the process of how firms internationalize over time.

It focuses on the steps, challenges, and factors that influence a company’s expansion abroad.

Question 9

According to the Uppsala Model, what two key factors drive the internationalization process?

Answer 9

Experiential learning and incremental commitments

Question 10

What major shift did the Uppsala Model undergo in its latest development?

Answer 10

From explaining firms’ Internationalization to explaining firms’ evolution

Question 11

In the 2009 version of the model, what key factor determines a firm’s success in international markets?

Answer 11

The firm’s network position and ability to build relationships

Question 12

Why did Vahlne and Johanson introduce “capabilities” into the model in its latest extension?

Answer 12

To show that firm evolution depends on more than just knowledge accumulation

Question 13

4 stage process of Internationalization (1997)

Answer 13

1. No regular export
2. Export via independent agents
3. Establishing slaes subsidiaries
4. Setting up production abroad