Do cross-national distances still affect the international penetration speed of digital innovation? The role of the global network effect

Fei Li; Yan Chen; Letong Liu; Mengyu Zhuang

doi:10.1016/j.heliyon.2023.e13911

Do cross-national distances still affect the international penetration speed of digital innovation? The role of the global network effect

Heliyon. 2023 Feb 28;9(3):e13911. doi: 10.1016/j.heliyon.2023.e13911. eCollection 2023 Mar.

Authors

Fei Li¹, Yan Chen¹, Letong Liu², Mengyu Zhuang¹

Affiliations

¹ School of Economics and Management, Beijing University of Posts and Telecomunications,Beijing,China.
² School of Economics, Zhejiang University,Hangzhou,China.

Abstract

This paper provides an improved understanding of the internationalisation speed of innovation in a digital context. It integrates virtual distance into the previous Cultural, Administrative, Geographic, and Economic (CAGE) distance framework. By tracking the penetration in 43 target countries of a unique sample of 102 mobile apps available on Apple's App Store, cultural and economic distances still hinder the penetration speed of digital innovation in a focal country. However, geographic and administrative ones no longer have a significant effect. More importantly, distance does not always act as a barrier, with high virtual spaces promoting international penetration. Therefore, digital innovation developers may overcome challenges presented by cross-national distances by resorting to the global user network effect.

Keywords: CAGE distance Model; Digital innovations; Internationalisation; The network effect; Virtual distance.