Does distance matter in explaining international expansion? Evidence from the global mobile telecommunications industry

The aim of this study is to analyse how the distance between countries determines host country selection. To explain foreign market entry we use two dimensions of the distance between countries: (1) geographic distance and (2) historical ties between the home and the host countries. We carry out descriptive, empirical and case study analyses in the mobile telecommunications industry to study how these two dimensions of distance determine the entrance of firms in foreign countries. Our work shows that geographic distance negatively affects the entrance of firms in host countries while historical ties between countries encourage firms to enter the host country. Moreover, historical ties positively moderate the relationship between geographic distance and market entry.