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    CAGE DISTANCE FRAMEWORK: OPPORTUNITIES FOR GLOBAL ARBITRAGE cultural DISTANCE different languages different ethnicities; lack of connective ethnic or social networks different religions different social norms ADMINISTRATIVE DISTANCE Absence of colonial ties Absence of shared monetary or political association political hostility government policies Institutional weakness GEOGRAPHIC DISTANCE Physical remoteness lack of a common border lack of sea or river access size of country

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    CAGE DISTANCE FRAMEWORK: OPPORTUNITIES FOR GLOBAL ARBITRAGE cultural DISTANCE different languages different ethnicities; lack of connective ethnic or social networks different religions different social norms ADMINISTRATIVE DISTANCE Absence of colonial ties Absence of shared monetary or political association political hostility government policies Institutional weakness GEOGRAPHIC DISTANCE Physical remoteness lack of a common border lack of sea or river access size of country

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    204 views1 page

    Cage

    Uploaded by

    archanasridhara
    CAGE DISTANCE FRAMEWORK: OPPORTUNITIES FOR GLOBAL ARBITRAGE cultural DISTANCE different languages different ethnicities; lack of connective ethnic or social networks different religions different social norms ADMINISTRATIVE DISTANCE Absence of colonial ties Absence of shared monetary or political association political hostility government policies Institutional weakness GEOGRAPHIC DISTANCE Physical remoteness lack of a common border lack of sea or river access size of country

    Copyright:

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    THE CAGE DISTANCE FRAMEWORK: OPPORTUNITIES FOR GLOBAL ARBITRAGE

    CULTURAL DISTANCE ADMINISTRATIVE DISTANCE GEOGRAPHIC DISTANCE ECONOMIC DISTANCE


    ATTRIBUTES CREATING DISTANCE
    Different languages Absence of colonial ties Physical remoteness Differences in consumer
    Different ethnicities; incomes
    Absence of shared monetary or Lack of a common border
    lack of connective political association Differences in costs
    Lack of sea or river access
    ethnic or social and quality of:
    Political hostility
    networks Size of country z Natural resources
    Government policies z Financial resources
    Different religions Weak transportation or
    z Human resources
    Institutional weakness communication links
    Different social norms z Infrastructure
    Differences in climates z Intermediate inputs
    z Information or knowledge

    INDUSTRIES OR PRODUCTS AFFECTED BY DISTANCE


    Products have high Government involvement is Products have a low value- Nature of demand varies
    linguistic content (TV) high in industries that are: of-weight or bulk ratio with income level (cars)
    (cement)
    Products affect Producers of staple goods Economies of
    cultural or national (electricity) Products are fragile or standardisation or scale
    identity of consumers perishable (glass, fruit) are important (mobile
    Producers of other
    (foods) phones)
    “entitlements” (drugs) Communications and
    Product features vary connectivity are important Labour and other factor
    Large employers (farming)
    in terms of size (cars); (financial services) cost differences are
    standards (electrical Large suppliers to government salient (garments)
    Local supervision and
    appliances) or (mass transportation)
    operational requirements Distribution or business
    packaging National champions are high (many services) systems are different
    Products carry (aerospace) (insurance)
    country-specific Vital to national security Companies need to be
    quality associations (telecom) responsive and agile
    (wines)
    Exploiters of natural resources (home appliances)
    (oil, mining)
    Subject to high sunk costs
    (infrastructure)
    Source: Harvard Business Review, September 2001

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