 In international business (IB) and marketing settings, psychic distance is based on "perceived" differences between a home country and a "foreign" country regardless of physical time and space factors which differ across diverse cultures.It is a subjective type of distance ("perceived differences") unlike the distances forming the CAGE framework, for instance.This makes psychic distance very difficult to measure, and oftentimes fallacious proxies are used to estimate it (e.g., Kogut & Singh (1988) index using Hofstede's (1980) cultural dimensions).