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- Publisher
- Emerald Publishing
- Copyright
- Copyright © 2008 Emerald Group Publishing Limited. All rights reserved.
- ISSN
- 1525-383X
- DOI
- 10.1108/1525383X200800017
- Publisher site
- See Article on Publisher Site
Abstract
Consistent with traditional internationalization theory, we argue that, when a firm chooses franchising to achieve market penetration, market propinquity/similarity matters. Using a modified gravity model, we examine six country characteristics believed to enhance the flow of franchise activity among 39 nations. Our findings support the notion that market propinquity facilitates the flow of franchises between nations. Franchise expansion is greatest when the home and host nations are similar in terms of geography, culture, media availability, and political risk. The management implications of these findings are discussed in detail.
Journal
Multinational Business Review – Emerald Publishing
Published: Jan 1, 2008
Keywords: Internationalization theory; Gravity model; Franchise expansion; Franchise activity