Geographic market diversification: A premium or discount in firm's value

To explain why international market diversification is a viable strategy, a substantial portion of the past literature hinges its conclusions on mainstay perspectives. Some authors utilize internalization theory and transaction cost analysis (e.g., Teece). Others draw from the resource-based explanation of the firm (e.g., Chang, 1995), institutional theory (e.g., Davis, Desai, & Francis, 2000), organizational learning (Ruigrok & Wagner, 2003); a combination approach (e.g., Madhok, 1997) or eclectic paradigm (Dunning, 1988). These perspectives are widely discussed in the literature. For that reason we present the earlier work only in a brief summary.