The CAGE Distance Framework is a tool that helps businesses identify and evaluate the differences between countries that could impact their international operations. It stands for Cultural, Administrative, Geographic, and Economic distances. Cultural distance refers to differences in language, ethnicity, religion, and social norms. Administrative distance includes differences in governance, political associations, and institutional weaknesses. Geographic distance refers to physical remoteness, lack of a common border, differences in climate, and transportation infrastructure. Economic distance includes differences in consumer incomes and variations in the cost and quality of resources and infrastructure. Businesses use this framework to assess the feasibility and profitability of expanding into specific international markets.
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