Abstract/Summary

This thesis builds jointly upon international business (IB) research on regionalization (Rugman and Verbeke 2004) and semiglobalization (Ghemawat 2003b) to advance the field’s understanding of the effects of multiple dimensions of distance on international activity. The regionalization research stream, grounded in analysis of firm-level data, has contributed to a diverse array of IB topics, but the binary distinction between intra-regional and inter-regional activity limits the granularity with which it can capture distance effects. Semiglobalization research using country-level gravity models highlights distance’s multidimensionality, but country-level analyses cannot directly address key firm-level research topics. This thesis estimates gravity models using both country- and firm-level data, relates gravity-based distance analysis to regionalization, and tests how well distance measures typically used in IB research perform in gravity models. Chapter One examines theoretical and empirical research on distance and discusses country-level gravity modeling. Chapter Two estimates gravity models using firm-level data to relate multiple dimensions of distance to the geographic footprints of the Fortune Global 500 and to test R&D intensity, advertising intensity and top management team non-nativity as potential moderators of distance effects. All three of these characteristics seem to moderate the effects of distance on the footprints of the firms studied. Chapter Three utilizes country- and firm-level gravity models to examine how regionalization relates to distance effects. It supports the contention that intra-regional activity is even more intense than would be predicted by standard gravity models but not the view that this phenomenon is due to “spikes” or “discontinuities” at the region boundary. Chapter Four turns to the distance measures employed in gravity models, testing how well the models perform when traditional distance measures from international economics are replaced with psychic, cultural, and institutional distance measures prominent in the IB literature. Chapter Five concludes with a discussion of future research directions.