The Theory Of The Uppsala Model: Barriers To Internationalization

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The theory of the Uppsala model presents that psychic distance is a barrier. Psychic distance consists of language differences, degree of education, business practices, cultural aspects, and industrial development (Johanson and Vahlne, 1977). It is clear that language differences play an important role as a barrier for firms internationalizing. Five companies in the thesis agreed with this and found language specifically to be an influential barrier in internationalization. Also, culture was influential when deciding which market to target and whether to target a specific market. Furthermore, for both Ariterm and Wapro, business practices had been perceived as somewhat constricting as other business practices could take longer and be more complicated. However, industrial development was also mentioned, out of context, as somewhat influential but it was not outlined as a barrier specifically. Markets lacking the necessary industrial development were simply not considered by the companies. The degree of education was not mentioned at all as this was not seen as a determinant for the success of their operations. Nevertheless, the Uppsala model bears a lot of applicability from the perspective of barriers in the internationalization of Swedish cleantech firms. The three influential barriers language, culture and business practices would according to the theory cause uncertainty, which seems legitimate in these findings as well.

Kahiya (2013) argued that firms lacking knowledge
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