The purpose of this paper is to develop a conceptual model for the mode of entry in a particular case of global MNEs entering into emerging markets.
The conceptual model builds on institutional theory and follows an integrated approach of entry mode theories using bargaining theory, the liability of foreignness and local legitimacy.
The conceptual model introduces five propositions.
The study has policy implications for emerging market institutions. Also, the model highlights the significance of long-term vision in global MNEs’ sustainability. However, the model excludes the MNEs’ internal institutions, home country institutions, as well as institutional and cognitive distances.
The conceptual model addresses the dynamics of MNEs’ entry decisions with long-term strategic vision. It helps to recognize the global MNEs’ internalization of the host country’s formal and informal institutions when the bargaining power is in imbalance.
