Numerous firms over the world try to invest in foreign market directly to get more profit and sustain their competitiveness. Although concern for firms’ entry mode selection has been dealt with in many previous studies, there are only a few studies ...
Numerous firms over the world try to invest in foreign market directly to get more profit and sustain their competitiveness. Although concern for firms’ entry mode selection has been dealt with in many previous studies, there are only a few studies for selection of Korean firms’ entry mode and they are not mainly focused on Asian developing countries which possess a big portion and are important for Korean firms’ outward FDI. Thus, this paper investigates the determinants of Korean firms’ outward FDI into 10 main Asian developing countries. Total 122 Korean firms are used as samples and logistic regression is conducted to analyze them. I investigate effects of firm internal factors and external factors on the selection of Korean firms’ foreign entry mode. As a result, this research empirically demonstrates that firm size, firm experience in domestic market, firm performance in domestic market, and firm internationalization factors affect significantly entry mode decision. Also, the result shows that the moderating effect of foreign investment risk is very strong. Overall, the findings of this study indicated that both firm internal and external factors play an important role for selection of Korean firms’ entry mode into Asian developing countries.