Discretion and internationalisation: impact of environmental determinants of managerial discretion and host country experience on entry mode choice

We examine the impact of the environmental determinants of managerial discretion on the internationalisation of Multinational Enterprises (MNEs) reflected in its choice of mode of entry. Using insights from the behavioural theory of the firm and the process view of internationalisation, we show that a composite measure of the environmental determinants of managerial discretion affects the MNE's choice of entry mode, with comparatively higher levels of environmental influence leading managers to choose the IJV (over WOS). At the same time, this relationship between the environmental determinants of managerial discretion and entry mode choice is intensified when the MNE has had prior host country experience.