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Management International Review

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12.05.2016 | Research Article

Internationalization Speed and Firm Performance: A Study of the Market-Seeking Expansion of Retail MNEs

verfasst von: Alexander Mohr, Georgios Batsakis

Erschienen in: Management International Review | Ausgabe 2/2017

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Abstract

Existing research is divided on whether firms that rapidly expand their overseas operations perform better than firms that internationalize slowly. Drawing on Penrose’s theory of the growth of the firm, we argue that the positive effects of rapid internationalization give way to negative effects with increasing internationalization speed, leading to an inverted U-shaped association between internationalization speed and firm performance. We analyze the market-seeking expansion of 110 retailers over a 10-year period (2003–2012) and find support for a curvilinear relationship between internationalization speed and firm performance that is moderated by the geographic scope of firms’ internationalization path and firms’ international experience. Our study contributes to resolving conflicting views on the link between internationalization speed and firm performance.

Nächster Artikel Institutional Distance and Foreign Subsidiary Performance in Emerging Markets: Moderating Effects of Ownership Strategy and Host-Country Experience

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We would like to thank one of the anonymous reviewers for highlighting this possibility.

We account for the possibility that the (negative) effects of host-country complexity might outweigh the suggested positive effects of geographic scope by controlling for host-country economic and cultural complexity in our empirical models. We would like to thank one of the anonymous reviewers for this suggestion.

We would like to thank one of the anonymous reviewers for stressing the importance of adopting ROE as an additional dependent variable.

We would like to thank one of the anonymous reviewers for raising this issue.

Aiken and West (1991) suggest splitting the sample into subgroups based on the moderating variables’ mean and standard deviations (i.e., mean ± 1 standard deviation). However, because the standard deviations of our moderating variables are greater than their means, we decided to form the three subgroups based on the mean and ±½ standard deviation (rather than the common ±1 standard deviation). As an alternative method of splitting our sample into subgroups, we used percentiles (low ≤ 25 % and high ≥ 75 %). The produced figures for both splitting samples are consistent.

These results are available from the authors.

We would like to thank one of the anonymous reviewers for pointing out the limitations with regard to our measures of internationalization speed and international experience.

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Titel: Internationalization Speed and Firm Performance: A Study of the Market-Seeking Expansion of Retail MNEs
verfasst von: Alexander Mohr
Georgios Batsakis
Publikationsdatum: 12.05.2016
Verlag: Springer Berlin Heidelberg
Erschienen in: Management International Review / Ausgabe 2/2017
Print ISSN: 0938-8249
Elektronische ISSN: 1861-8901
DOI: https://doi.org/10.1007/s11575-016-0284-9

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