ENTREPRENEUR'S ACTUAL BEHAVIORAL CONTROLS, PSYCHIC DISTANCE STIMULI, AND EXPORT MODE CHOICE

ENTREPRENEUR’S ACTUAL BEHAVIORAL CONTROLS, PSYCHICDISTANCE STIMULI, AND EXPORT MODE CHOICE NGO VI DUNG Hanoi School of Business, Vietnam National University B1-144 Xuan Thuy, Cau Giay, H

Trang 1

ENTREPRENEUR’S ACTUAL BEHAVIORAL CONTROLS, PSYCHIC

DISTANCE STIMULI, AND EXPORT MODE CHOICE

NGO VI DUNG Hanoi School of Business, Vietnam National University B1-144 Xuan Thuy, Cau Giay, Hanoi, Vietnam

dungnv@hsb.edu.vn FRANK JANSSEN Louvain School of Management, Universit e catholique de Louvain Place des Doyens 1, 1348 Louvain-la-Neuve, Belgium

Received February 2015 Revised May 2015 Published July 2015

This paper looks at the mediating effect of entrepreneurs ’ actual behavioral controls on the relationship between psychic distance stimuli and export mode choice of SMEs Based on a dataset of 84 Viet- namese exporters, we ﬁnd that: (i) entrepreneurs’ actual behavioral controls and organizational factors are determinants of Vietnamese SMEs ’ export mode choice; (ii) psychic distance (geographic distance and psychic distance stimuli) does not in ﬂuence Vietnamese SMEs’ export mode choice; (iii) entrepreneurs ’ actual behavioral controls do not play the mediating or moderating role in the relationship between psychic distance and Vietnamese SMEs ’ export mode choice.

Keywords: Export behavior; export mode; psychic distance; SMEs; Vietnam.

1 Introduction

Theﬁrms from emerging and transition economies (ETEs) are raising their importance inthe global economy (Bruton et al.,2008;Wright et al.,2005) through common interna-tionalization strategies such as exporting (Aulakh et al.,2000) or foreign direct investment

has been done in the context of developed economies (Bruton et al.,2008;Leonidou et al.,

2010) When prior studies look at ETEs, they often focus on China, Brazil, South Africa,Russia or countries in Central and Eastern of Europe (Aulakh et al., 2000; Calof and

ETEs has recently improved our existing knowledge on entrepreneurship (Kiss et al.,

2012), that is often considered as the most important engine of rapid growth and opment of ETEs the last decades, is still far from exhaustive (Bruton et al., 2008;

DOI: 10.1142/S1084946715500132

J Dev Entrepreneurship 2015.20 Downloaded from www.worldscientific.com by FLINDERS UNIVERSITY LIBRARY on 12/18/15 For personal use only.

Trang 2

ETEs are characterized by a lack or a weakness of market-supporting institutions, bothformal and informal (Manolova et al., 2008; Peng and Heath, 1996) For this reason,certain authors argue that the ﬁrm’s strategy in ETEs can be better explained by theinstitution-based view, followed by the industry-based and resource-based views

interna-tional business (e.g Peng and Khoury, 2008) and entrepreneurship (e.g.Welter and

institutional ones Nevertheless, in the case of small and medium-sized enterprises(SMEs), it is argued that the owner’s (i.e., entrepreneur) characteristics play a major rolebecause this type of enterprise is often considered as an extension of the entrepreneur

existence of decision maker’s characteristics at the level of the firm .can mediate theimpact of the environmental andfirm contextual characteristics in export decision mak-ing.” Recently, Willams (2010) showed that personal factors, such as international jobexperience and foreign travel experience, of entrepreneurs are critical determinants ofexport decision (i.e export propensity).Kiss et al.(2012) also argued that the mediating ormoderating links between the contexts and the entrepreneur’s cognitive profiles are im-portant to understand theirfirm’s internationalization, especially in ETEs characterized byresource constrained environments

In fact, prior studies in international business and international entrepreneurship oftenfocus on (i) the largerfirms (i.e., multinational enterprises) rather than SMEs, (ii) the directand discrete impacts of the environmental factors, including institutional ones on thefirm’sstrategy rather than on the moderating or mediating role of organizational and entrepre-neurial factors; and (iii) thefirms from developed economies (DEs) that operate in ETEsrather than on localfirms of ETEs (Beamish and Lee,2003;Brouthers and Nakos,2004;

research neglects the interaction between entrepreneurial and environmental factors andtheir impact on the behaviors of SMEs from ETEs In this context, the current study aims

to investigate the following research question: Do entrepreneur-related factors mediate ormoderate the inﬂuence of environmental factors on the export mode choice of SMEs?Our study is carried out within a sample of exporters from Vietnam, an ETE ofSoutheast Asia Like China, the countries of Eastern Europe and the former Soviet Union,Vietnam is a transition economy because its economy has been formally transitioning from

a centrally planned to a market-based economy since 1986 Vietnam achieved a high rate

of growth (an average of 7.2% in the period of 2000–2010), and became a middle incomecountry in 2010 (World Bank, 2010) Exporting is vitally important for Vietnam because itaccounts for about 83.9 percent of its GDP (World Bank, 2014) Together with the EasternEuropean countries and China, Vietnam is one of the best destinations for foreign directinvestment (Buckley and Casson,1998) For these reasons, certain authors believe thatVietnam is a promising research context for testing and developing existing literature inentrepreneurship and strategy (Kiss et al., 2012; Peng and Heath, 1996; Peng, 2003)

N V Dung & F Janssen

Trang 3

However, until now there is a limited number of studies looking at the internationalization

of Vietnameseﬁrms (Kokko and Sjöholm,2004;Nguyen et al.,2008,2012)

Theoretically, our study focuses not only on institutional environment but also otherenvironmental factors on the one hand, and we investigate not only the environment ofeither the home or host market but the interaction of these markets on the other hand Moreprecisely, we apply two different but complementary approaches that allow us to inves-tigate the relationship between environmental and entrepreneur-related factors and theirimpact on SMEs’ internationalization strategy (i.e., export mode choice): the PsychicDistance perspective (PDp) and the Theory of Planned Behavior (TPB) The PDp is theone of the traditional perspectives in internationalization theories (Johanson and Vahlne,

1977) while the TPB is appropriate to understand the individual’s (i.e., entrepreneurs)behavior (Ajzen,1991) Based on this new framework, we expect that the environmentalfactors (i.e., macro-differences or psychic distance stimuli between the home and the hostmarkets) inﬂuence the export mode choice, but also that this impact can be mediated ormoderated by entrepreneur-related factors (i.e., entrepreneur’s actual behavior controls).The rest of this paper is structured as follows: in theﬁrst section, based on the TPB and

on the PDp, we develop our hypotheses to explain and predict the export mode choice ofSMEs from Vietnam The second section describes the data, variables and measurementsused in our study The research results are presented and discussed in the third and fourthsections, respectively This article concludes by stressing our study’s contributions, lim-itations and its implications for future research, managers and policy makers

2 Literature Review

Export mode choice or how to enter export markets (e.g by direct or indirect mode) is one

of the key decisions that entrepreneurs of SMEs should perform in exporting (togetherwith whether to export— export propensity, where to export — export market selection,how much to export— export expansion, etc.) (Leonidou et al.,2010) In indirect export,the exporters use independent organizations (domestic or international) located in thehome country to export their products In direct export, the exporters sell their productsdirectly to the importers or buyers located in foreign countries (Albaum et al.,1998;Root,

central role of entrepreneur, allows us to apply two different but complementaryapproaches to explain and predict the export mode choice of SMEs in emerging econo-mies: the Internationalization Theory (i.e the PDp) and the TPB

2.1 Psychic distance stimuli and export mode choice

The PDp, which aims to explain and predict theﬁrm’s internationalization behavior, hasmainly been developed by the Uppsala school This theoretical perspective proposes thattheﬁrm’s entry mode choice is determined by two key factors: (i) psychological or psychicdistance between the home and the host countries and (ii) international market knowledgeand experience (Dow and Larimo, 2009; Johanson and Vahlne, 1977).a The psychic

Trang 4

distance is defined as “the sum of factors preventing the flow of information to and fromthe market Examples are differences in language, education, business practices, cultureand industrial development” (Johanson and Vahlne,1977) The measurement of psychicdistance or non-geographic distance has achieved a remarkable progress and includesseveral dimensions such as languages, religions, industrial development, levels of edu-cation and political systems (Dow and Karunaratna,2006).bAccording to the PDp, dif-ferences or distances (geographic and non-geographic) between the home and hostcountries cause“the lack of, and difficulty of obtaining market knowledge in internationaloperations” (Johanson and Vahlne, 1977) This situation influences the entrepreneur’sperception of risk and uncertainty, and therefore, thefirm’s internationalization behavior

interna-tional market knowledge and experience through“connection with activities that are based

on relations to other individuals” (Johanson and Vahlne,1977), the inﬂuence of psychicdistance on the ﬁrm’s internationalization behavior diminishes (Dow and Larimo,2009;

In addition, PDp distinguishes two types of psychic distance: psychic distance stimuliand perceived psychic distance The former refers to actual macro-level differences be-tween the home and the host countries, and the latter are individual perceptions of thesemacro-level differences (Dow and Karunaratna,2006).Dow and Karunaratna(2006) arguethat the main limitation of the perceptual approach is that researchers often measure an expost perception (after decisions are made), and that, although a relationship betweenperceptions and actions can be found, the direction of causality is still equivocal For thisreason, in this study, we focus on the relationship between psychic distance stimuli (in-stead of perceived psychic distance) and SMEs’ export mode choice

We can apply PDp’s propositions to explain and predict SMEs’ export behavior ingeneral and their export mode choice in particular SMEs are often considered to belacking resources and capabilities, and to be facing more barriers than large firms ininternational markets (Acs et al.,1997;Leonidou et al., 2011) Compared with indirectexport, direct export requires SMEs to invest more resources and capabilities to establish,maintain and control exporting activities (Hessels and Terjesen,2010) In this context, ifSMEs use a direct export mode, it is very difficult for them to compete with larger firms,

a The Uppsala school uses the concept of “market knowledge” that is deﬁned as “information about markets and operations in those markets, which is somehow stored and reasonably retrievable — in the mind of individuals, in computer memories and in written reports ” Market knowledge can be classiﬁed into “objective knowledge” that

“can be taught,” and “experiential knowledge” that “can only be learned through personal experience” on the one hand; and into “general knowledge” concerning marketing methods and customers disregarding their geographic location, and “speciﬁc knowledge” concerning characteristics of the speciﬁc national market ( Johanson and Vahlne , 1977 ) on the other hand Recently, researchers belonging to psychic distance theory insist only on international experience ( Dow and Larimo , 2009 ; Dow , 2000 ) However, as we have seen, the Uppsala school ’s concept of international market knowledge already includes an experiential dimension.

b Dow ( 2000 ) argues that although geographic distance is often considered as a dimension of psychic distance, this kind of distance is largely independent of psychological or non-geographic distance For a more systematic and exhaustive comparison of the advantage of psychic distance ’s measurement used in this study with other psychic distance’s measurements, including cultural distance ( Kogut and Singh , 1988 ; Hofstede , 2001 ), see Dow and Karunaratna ( 2006 ).

Trang 5

especially in unfamiliar, distant markets that require more export resources Thus, we canexpect that the more distant their export markets are, the more likely SMEs will be toexport indirectly rather than directly (Peng and Ilinitch,1998) Several empirical studiesfind that psychic distance significantly and negatively influences entry mode choice Forexample, Dow and Larimo (2009)find that several types of distance (culture, religion,industrial development, education) influence the high control entry mode choice of Nordicfirms: the higher the distance between the home and the host countries is, the more likelyNordic investors are to use joint ventures with a local partner rather than a wholly ownedsubsidiary Dow (2000) finds that psychic distance (geographic distance and perceivedpsychic distance) influences export market selection of Australian SMEs: the more distant

a host market is, the less frequently it is present among thefirst five export markets of thefirm Based on these theoretical and empirical arguments, we propose that:

H1: The more distant (geographic distance and psychic distance stimuli) their exportmarkets are, the less likely SMEs are to export directly

2.2 Entrepreneur’s actual behavior controls and export mode choice

TPB is an extension of the Theory of Reasoned Action (TRA) (Ajzen and Fishbein,1980;

This theory supposes that the individual behavior is determined by two major factors:(i) the behavioral intention or motivational factors deﬁned as the degree of willingness andeffort that people dispose to perform a behavior (action), and (ii) the behavioral controls ornon-motivational factors deﬁned as the “availability of requisite opportunities andresources (time, money, skills, cooperation of others)” (Ajzen, 1991) Like TRA, TPBproposes that the behavioral intention is determined by (i) the attitude toward a behavior or

“the degree to which a person has a favorable or unfavorable evaluation or appraisal of thebehavior in question,” (ii) subjective norms or “the perceived social pressure to perform ornot to perform the behavior” (Ajzen,1991) The main difference between TPB and TRA isthe fact that TPB proposes that (i) an action is determined not only by the behavioralintention but also by the behavioral controls and that (ii) the behavioral controls inﬂuence,not only directly but also indirectly, an action through its impact on the intention and onthe intention’s antecedents (attitude toward behavior and subjective norms)

TPB distinguishes two types of behavioral controls: actual and perceived behavioralcontrol Theﬁrst are the resources and opportunities available to the entrepreneur, whilethe second is the entrepreneur’s perception and belief about his/her resources andopportunities (Ajzen, 1991) Although the perceptual measure has more psychologicalinterest (the relationship between behavioral perception, behavioral intention and action),TPB’s founder also argues that “the importance of actual behavioral control is self-evident:The resources and opportunities available to a person must to some extent dictate thelikelihood of behavioral achievement” and that “perceived behavioral control may not beparticularly realistic when a person has relatively little information about the behavior,when requirements or available resources have changed, or when new and unfamiliarelements have entered into the situation” (Ajzen,1991) For this reason, in this study that

Trang 6

focuses on internationalization phenomenon characterized by rapid change and high certainty, we focus on the direct relationship between the entrepreneur’s actual behavioralcontrol (instead of perceived behavioral control) and SMEs’ export mode choice.TPB can be used to explain and predict the export mode choice As mentioned above,compared with indirect export, direct export requires more resources and capabilities toestablish, maintain and control exporting activities (Hessels and Terjesen,2010) In thecontext of SMEs, this also means that direct export requires more behavior controls (time,capital, knowledge, skill, experience, social ties, for example) from entrepreneurs In turn,

un-we can expect that if an entrepreneur has more behavioral controls, he or she will be able

to perform more difﬁcult tasks concerning exporting activities, i.e., direct export incomparison with indirect export The entrepreneur’s actual behavioral controls can bemeasured by proxies of his/her characteristics such as age, gender, educational level,professional experience, international market experience (e.g., time spent abroad by living,studying, working or travelling), social ties and immigrant status The entrepreneur’sactual behavioral controls are argued to inﬂuence his/her ability and attitude and therefore,his/her behavioral intention and action (Axinn,1988;Ellis,2000;Ellis and Pecotich,2001;

Prior export studies on managerial factors provide many evidences of the relationshipbetween entrepreneur-related characteristics and theﬁrm’s export behaviors (Miesenbock,

that the entrepreneur’s age and education level influence his/her attitude toward risk-takingand therefore his/her export decision (export propensity): exporters are younger, moreeducated and more liberal Orser et al.(2010)find that the entrepreneur’s gender influ-ences the export behavior (export propensity) of Canadian SMEs:firms owned by femaleentrepreneurs are less likely to export thanfirms owned by men.Ellis(2000) argues that anentrepreneur’s foreign market knowledge is mainly acquired by social ties rather than bymarket research.Ellis and Pecotich(2001)find that the export is often initiated by one or acombination of three agents (seller-exporters, buyers, or third parties) who have alreadyestablished relationships with the manager In other words, social ties can bring bothexport opportunities and resources for entrepreneurs

In fact, TPB does not clearly identify the different types of entrepreneur’s actualbehavioral control In the present study, we focus on three groups of entrepreneur’s actualbehavioral control: (i) the entrepreneur’s demographic characteristics (age and gender); (ii)the entrepreneur’s human capital (level of education and international experience); and (iii)the entrepreneur’s social capital (social ties) Based on these theoretical and empiricalarguments, we propose that:

H2: The more actual behavioral controls the entrepreneur has, the more likely his/herSME is to export directly Concretely:

H2a: The older the entrepreneur is, the less likely his/her SME is to export directly.H2b: SMEs managed by female entrepreneurs are less likely to export directly than thosemanaged by male entrepreneurs

Trang 7

H2c: The higher the entrepreneur’s level of education is, the more likely his/her SME is toexport directly.

H2d: The more international experience the entrepreneur has, the more likely his/her SME

is to export directly

H2e: The more social ties the entrepreneur has, the more likely his/her SME is to exportdirectly

2.3 Mediating (moderating) role of entrepreneur’s actual behavior control

As we have seen, TPB insists on the entrepreneur’s characteristics (i.e behavioral trols) while PDp insists on theﬁrm’s characteristics (i.e international market knowledgeand experience) and its environments in the home and host markets (i.e geographic andpsychic distances) In the context of SMEs, as mentioned above, we suppose that theentrepreneur plays a central role It seems that the concept of behavioral controls is largerthan the ones of international market knowledge and international experience because itincorporates not only the experiential dimension but also other dimensions of the entre-preneur’s characteristics such as time, money, skills, social ties (Ajzen,1991) However,through these concepts, we can combine TPB and PDp to build a new framework toanalyze SMEs’ internationalization behavior This framework allows us to analyze notonly the direct relationship between entrepreneur-related factors and export mode choice(traditionally investigated by TPB) and the direct relationship between environmentalfactors and export mode choice (traditionally investigated by PDp), but also the mediating

con-or moderating role of entrepreneur-related factcon-ors, i.e the entrepreneur’s behavioralcontrols, asReid(1981) stressed A few studies have investigated the moderating role ofinternational market experience: Dow (2000) ﬁnds that the negative impact of psychicdistance (geographic and psychic distance) on export market selection (the frequency that

an export market entered in the first five export markets of Australian firms) diminishesbecause of the moderating role of export experience (cultural learning).Dow and Larimo(2009) go one step further by distinguishing international market experience in similar anddissimilar markets: they argue that only international market experience in markets similar

to the host market positively inﬂuences the ﬁrm’s high-control entry mode choice (whollyowned subsidiary vs joint venture with local partner) Unfortunately, this study does notinvestigate the moderating role of these two types of international market experiences.Based on these theoretical and empirical arguments, we propose that:

H3: The more actual behavioral controls entrepreneurs have, the less likely psychic tance stimuli will be to inﬂuence export mode choice of SMEs

Trang 8

and services.cHowever, to facilitate the comparison of our research results with those ofother export studies in developed economies, we use one of the elements of the EuropeanCommission’s definition, being that SMEs have less than 250 employees.dWe use twosecondary datasets The first one is a dataset on 2635 small and medium manufacturingenterprises in Vietnam, resulting from cooperation between Danish and Vietnameseinstitutions in 2007 This dataset provides variables concerning export markets, exportmode (direct and indirect), firms’ performance, entrepreneurs’ characteristics (demo-graphic, ethnicity, education, experience, social ties, for example), firms’ characteristics(location, age, size, industry, for example) and domestic environmental characteristics.Among the 2635 firms, there are 154 firms engaging in exporting activities (about 6.5percent of total sample population) but thirteen do not meet our SMEs’ definition criteria

in terms of number of employees (more than 250 employees) In addition, 45ﬁrms did notprovide any information about their export market because they only export indirectly and

do not know theﬁnal destination of their products Furthermore, twelve ﬁrms that onlyexport to the group of “Other” countriese

do not provide any information about theirprecise export market; therefore, we cannot calculate the geographic distance and psychicdistance stimuli of this group of countries Thefinal sample consists of 84 firms (n ¼ 84)with 67 firms only exporting directly and seventeen firms exporting both directly andthrough trading companies Although our sample size could be seen as small based onconventional wisdom of sampling theory, according toLeonidou and Katsikea(2010), it isacceptable because about 30 percent of the export studies published between 1960 and

2007 have a sample size of 99 or less.fSecond, based on the information of export marketsprovided by theﬁrst dataset, we combine it with the work ofDow and Karunaratna(2006)

to incorporate variables concerning psychic distance (languages, religions, industrial velopment, levels of education and political differences) and geographic distance betweenVietnam and its export markets

de-3.2 Variables

3.2.1 Dependent variable

FollowingHessels and Terjesen(2010), we measure the dependent variable, export modechoice (EXMODE), as a dummy variable with direct export¼ 1 and indirect ¼ 0.3.2.2 Independent variables

In line withDow (2000), we distinguish two types of psychic distance: geographic tance and psychic distance stimuli The geographic distance is measured in nautical miles

dis-c Source: Degree 56/2009/ND-CP on assistance for SMEs development (www.gov.vn).

d Source: http://ec.europa.eu/enterprise/policies/sme/facts- ﬁgures-analysis/sme-deﬁnition/index en.htm

e In our secondary dataset, the ﬁrms export to China, Japan, ASEAN, USA, EU, Russia and “Other” countries.

f If we use the rule of 10 suggested by Peduzzi et al ( 1996 ), the minimum sample size of our study can be calculated as follows: n ¼ 10 k/p in which “p” is the proportion of positive cases in the population (p ¼ 0:8 in our study) and “k” is the number of covariates (or the number of independent variables, k ¼ 11 in our study) Our minimum sample size would be: n ¼ 10 11=08 ¼ 137.

Trang 9

from Vietnam’s main seaport (Ho Chi Minh City port) to the nearest international mainport of six major export markets and group of markets: Hong Kong for China, Nagasakifor Japan, Singapore as the nearest port of ASEAN countries, Los Angeles for the USA,Marseille (France) as the nearest international port of the EU and Vladivostok for Russia.gThe total geographic distance (GEODIS) of theﬁrm with its export markets is calculated

as weighted mean of geographic distance between Vietnam and each of six countries andgroup of countries it exported to:

The psychic distance stimuli are measured with scales forﬁve dimensions (languages,religions, industrial development, levels of education and political systems) developed byDow and his colleagues (Dow,2000;Dow and Ferencikova,2010;Dow and Karunaratna,

problem of multicollinearity, we converted these ﬁve dimensions into a single index ofpsychic distance stimuli between Vietnam and 119 other countries (Table1) The total

Trang 10

psychic distance stimuli (PSYDIS) the ﬁrm should resolve with its export markets iscalculated as a weighted mean of psychic distance stimuli between Vietnam and each ofsix countries and group of countries theﬁrm exported to:

Source: Adapted from http://www.mbs.edu/home/dow/research/

Trang 11

According toDow and Larimo(2009), three common scales of international experienceare the number of previous foreign markets entries, the number of years of internationalexperience and the number of years of operational experience in the target market In thisstudy, we adapt the second scale to measure theﬁrm’s international experience because it

is the only available scale provided by our secondary dataset: the number of years theﬁrmhas products for direct export (INTEXP)

In line with several previous studies (Axinn,1988;McConnell,1979;Leonidou et al.,

is measured in number of years since his/her year of birth; the entrepreneur’s gender(ENTGEN) is a dummy variable with “male” ¼ “1,” “female” ¼ “0”; the entrepreneur’seducation level (ENTEDU) is dummy variable with“lower education” ¼ “0” for no pro-fessional education and vocational education, and“higher education” ¼ “1” for technicalsecondary education, college/university and post university Following Peng and Luo(2000), we distinguish two types of ties: ties with entrepreneurs/managers of otherﬁrms inthe same or in a different sector (BUSTIE), and ties with government ofﬁcials such as bank

ofﬁcials, politicians and civil servants (OFFTIE) These social ties are measured as thenumber of people the entrepreneur currently has regular contact with at least once everythree months and perceived as useful for his/her business

3.2.3 Control variables

Several empirical studies identiﬁed the relationship between export behavior and variousorganizational factors such as theﬁrm’s industry (Cavusgil and Nevin,1981;Kedia and

total annual sales or number of employees (Calof,1993,1994;Cavusgil and Nevin,1981;

2010) and its location (Zhao and Zou,2002) We use as control variables theﬁrm’s size(measured by number of total permanent and full time employees, FIRSIZE) (Hessels and

because there are huge differences in terms of infrastructural conditions between urban andrural areas, we code the ﬁrm’s location (FIRLOC1) as a dummy variables with

“rural” ¼ “0” and “urban” ¼ “1.” In addition, we also introduce the provinces in which thefirm localizes (a dummy variable with the “firm’s province” ¼ “1,” “other” ¼ 0) as analternative control variable of its location (FIRLOC2): when the provincial location isintroduced, the location“urban/rural” is removed from the models to avoid the problem ofredundancy The firm’s industry (FIRINDU) is determined based on Vietnamese ISIC4-digit code (1993) and there are three groups of firms: a categorical variable with

“1” ¼ “Mining” (62 observations), “2” ¼ “Manufacturing” (74 observations) and

“3” ¼ “Other” (5 observations)

In line with previous studies (e.g.Hessels and Terjesen, 2010), we use binary orbinominal logistic regression and introduce groups of variables in incremental steps (byblock entry method) to test ourﬁrst two hypotheses Within each block, we choose the

Trang 12

forced entry method (“Enter”) because of the theory testing nature of our hypothesis First,

in model 1 (the base model), we only introduce control variables (ﬁrm’s size, age, industrylocation) In model 2, we add variables of psychic distance (geographic distance andpsychic distance stimuli) to the base model In model 3, variables of entrepreneur’s actualbehavioral controls (age, gender, education, social ties, and international experience) areincluded and variables of geographic distance and psychic distance are excluded In model

4, all groups of variables are introduced Based on the testing results of Hypotheses 1 and

2, we will determine techniques to test Hypothesis 3, depending on whether entrepreneur’sactual behavioral controls play a mediating or moderating role

We tested for multicollinearity between the predictor variables by using variance ﬂation factors (VIFs) Almost all VIFs are well below 10 (from 1.12 to 1.99) except forgeographic distance and psychic distance (12.47 and 11.52, respectively) This meansthere is collinearity between two types of distance (Field, 2005) To solve this problem, wedid a factor analysis on these two predictors and used resulting factor scores (PSYGEO) as

in-a new predictor (Field, 2005) We then re-tested for multicollinein-arity in-and our results showthat all VIFs are well below 10 (from 1.13 to 1.86)

4 Results

The descriptive statistics (Table 2) show some interesting findings First, the neur’s age and the firm’s age are positively and significantly correlated Second, theentrepreneur’s levels of education are negatively and significantly correlated with thefirm’s age: older entrepreneurs of more established firms are less educated than youngerentrepreneurs of more recently establishedfirms To a certain extent, those mean that, inthe context of SMEs, the organizational life cycle is strongly tied to its owners, i.e.,entrepreneurs Our assumption about the central role of entrepreneurs in SMEs is thereforeappropriate

entrepre-The results of the binomial logistic regression are presented in Table3 Model 1, whichonly includes control variables, shows the ﬁrm’s age, size and locations signiﬁcantly

influence Vietnamese SMEs’ export mode choice: the more established the firms are, theless likely they are to export directly; larger firms are more likely to export directly thansmaller ones; SMEs in urban areas are more likely to choose direct export than those inrural areas; and thefirms in Ho Chi Minh City are more likely to export directly than anyfirms in other provinces

Model 2, which includes controls variables and psychic distance, shows three portantfindings: first, psychic distance does not significantly influence Vietnamese SMEs’export mode choice; second, when psychic distance is introduced, none of the controlvariables significantly influences export mode choice; third, when psychic distance isintroduced, the model’s explanatory power is poorer than in model 1: LR chi2 is verysmall (4.89) and Prob> chi2 is not significant (p-value ¼ 0:43) This means that in theface of psychic distance, organizational factors (i.e., the firm’s age, size, industry andlocations) alone cannot appropriately explain the export mode choices of SMEs in oursample

im-N V Dung & F Janssen

Định dạng
Số trang	24
Dung lượng	194,71 KB