Patterns of internationalization of Brazilian firms and the decision to establish subsidiaries abroad

Abstract

The internationalization process of Brazilian firms was examined using the case study method of research, in order to determine whether existing theories could explain the Brazilian experience. Ten in-depth case studies were conducted. All companies studied were involved in foreign direct investment (FDI) at the time of data collection, and, with the exception of one, had started their internationalization by exporting. Motives to internationalize and to establish subsidiaries abroad were investigated. Typical patterns of motives to invest abroad and common sequences of entry modes were identified. The choice of foreign markets for FDI seemed to be associated with perceived psychic distance as postulated in the literature. The ownership structure, however, did not seem to follow the patterns identified in other studies. The study confirmed the proposition that inspired leaders play a major role in the initial steps of the internationalization process. Following network theory, personal and professional networks were determined to be of paramount importance in this process. Concluding, a framework is proposed for the study of the FDI decision of firms from emerging countries.

Citation

Barretto, A. and da Rocha, A. (2001), "Patterns of internationalization of Brazilian firms and the decision to establish subsidiaries abroad", Axinn, C.N. and Matthyssens, P. (Ed.) Reassessing the Internationalization of the Firm (Advances in International Marketing, Vol. 11), Emerald Group Publishing Limited, Leeds, pp. 79-131. https://doi.org/10.1016/S1474-7979(01)11017-3