AbstractsEconomics

The suggested theory is based upon many vital concepts of prior models, especially that of the Uppsala model because of its use of a Stages approach. What separates the proposed model and that of Uppsala is the divergence from the concept of incremental movement through Stages. Instead, Stages are reached on a conditional basis, which allows for free movement between Stages based on certain factor conditions. The model was founded on an interaction between the degree of a firm's ability, and the degree of a firm's motivation, which in turn depicted a certain level of commitment as regards forein entry mode choice. Propositions were created to test the validity of the factors, as well as for testing how strategy also plays a role in entry mode choice. As this study was deductive, after the theory was developed with the help of existing literature, empirical testing was then able to take place on a sample of consumer product companies. Transaction Cost Analysis, the Eclectic Paradigm, and the Network theory was also instrumental in the development of this theory; therefore the paper includes an extensive literature review prior to the disussion of the theory. The results of empirical testing are then included, as well as an in depth analysis of those resuls. The analysis contains a detailed description of the findings from each specific proposition, and ends with a discussion of the combined results. Finally, the conclusions are presented to summarize the results, and to offer thoughts on practical implications as well as suggestions for further research.