Transaction cost theory - explaining entry mode choices

Abstract

Foreign entry mode is one of the most crucial decisions companies have to make while determining their internationalisation strategy. In this study we attempt to review the determinism of these decisions by examining some concepts applied. Special consideration is given to transaction cost theory which is known to be the most frequently used tool in this field. The aim of this paper is therefore to revise and answer Shaver's [2013] recent question, whether we still need more entry mode studies and if yes, what exactly should be studied?(original abstract)