Networks and internationalisation

Abstract

The explanatory power of economics-based theories incrementalism and network theory are studied in the cases of four Multinational Corporations in Ukraine. All are concerned to protect monopolistic advantages against the uncertainty of Ukraine. Clustering of entry timing supports oligopolistic reaction theory. Three firms use high investment entry modes expected by internalisation, although one firm of equal size and degree of internationalisation uses the low investment mode expected by incrementalism. Network theory provides an understanding of the web of relationships in which the firm is embedded. Previous government-controlled relationships in Ukraine have broken down. The risks accepted by household consumables firms trying to penetrate Ukrainian networks are much greater than those of financial services firms who are serving international customers and regulators from more stable economies.