Research Summary: The unique preferences of family firms may lead to internationalization strategies that differ from those of nonfamily firms. Furthermore, heterogeneity among family firms may lead to variation in internationalization. From the mixed gamble perspective, we examine the internationalization of different types of family firms (weak family owned, strong family owned, and family owned and managed), as well as nonfamily firms, considering how differences in family involvement alter the perceptions of potential gains and losses to socioemotional and financial wealth. We also highlight the varying sensitivities of nonfamily firms and types of family firms to the effects of available and recoverable slack. Our findings underscore differences in internationalization strategies among family and nonfamily firms and demonstrate that slack alters the mixed gamble calculus of internationalization for the different types of firms. Managerial Summary: Whether family firms internationalize more or less than nonfamily firms is debated. We aim to reconcile this debate by investigating the extent and breadth of internationalization and home region orientation. We propose that inconsistent results regarding family firms’ internationalization are due to their heterogeneity whereby family ownership and management lead to different preferences. Study results support our framework by demonstrating that while nonfamily firms exhibit the highest levels of internationalization, there is much variance among family firms. Additionally, we demonstrate that financial slack further explains differences between family and nonfamily firms. Our study therefore offers a richer understanding of family and nonfamily firms’ internationalization and reveals significant differences among family firms that suggest family owners and managers view the risks of internationalization differently.

Strategy and finance research suggests that managerial ownership results in increased incentive alignment and therefore is negatively related to corporate diversification. Using a longitudinal approach, we develop arguments to examine whether managerial ownership is associated with subsequent changes in diversification and/or if diversification is associated with subsequent changes in ownership. The results indicate that levels of managerial ownership in one time period are not associated with subsequent changes in corporate diversification, which raises incentive alignment questions. We also find that higher levels of corporate diversification are associated with changes in managerial ownership, which suggests support for the employment risk-reduction perspective. This study provides important reasons to reassess the longitudinal implications of the managerial ownership-corporate diversification link from both theoretical and managerial perspectives.

Recent international strategy research emphasizes the importance of understanding the effects of geographic location on firms’ strategies and performance outcomes. We contribute to this research by providing empirical evidence that the interplay of country and industry effects matters substantially in explaining the variation in the value of growth options of firms based in different countries. Our results show that country–industry effects are the second largest source of variation, following firm effects, while industry and country effects are relatively small when considered in their own right. That valuable growth options are tied to country and industry interactions has important implications for international strategy research and practice. Journal of International Business Studies (2008) 39, 387–405. doi:10.1057/palgrave.jibs.8400355

Industry descriptions often depict science-driven industries as a single industry class, dominated by explicit knowledge in the form of patents, blueprints, diagrams, etc. This onedimensional view limits our ability to effectively manage the activities and routines across various stages of a science life cycle. The life cycle concept refers to the extent of development of the underlying scientific knowledge base. The knowledge in developed science fields (e.g. chemicals) is well codified, whereas in developing fields (e.g. biotechnology), it is less so. This variance creates interesting implications for innovation ± product development routines will differ across developed and developing sciences. The purpose of this paper is to compare and contrast the knowledge-and resource-based requirements of developed and developing science industries and the link to competitive advantage.

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Research has examined the effects of managerial share ownership on business diversification, typically from the incentive alignment perspective. Yet, share ownership also shifts risk to managers (the efficient managerial contracting perspective). Furthermore, the effects of managerial ownership on international diversification are unexplored. We examine how managerial ownership influences both international and business diversification in light of the trade‐off between incentive alignment and risk bearing. Based on the differing risk profiles of the two types of diversification, we argue that incentive contracts with higher levels of managerial ownership will be inefficient, i.e., counter to shareholder interests—reducing international diversification and increasing business diversification. Our findings support our arguments for international diversification. We find no significant effect for business diversification after accounting for endogeneity and serial correlation. Copyright © 2013 John Wiley & Sons, Ltd.

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