Distance has long been recognized as a major impediment in MNEs' international expansion. However, it still remains unclear: (1) If different psychic distance stimuli (PDS) constitute different sources of complexity and (2) how PDS affect MNE performance during international expansion. That is,...

Purpose – The purpose of this paper is to address how firms adapt their product and geographic diversification as a response to foreign rivals penetrating their domestic market by adopting a behavioral perspective to understand firm-level strategic responses to foreign entry....