An empirical analysis and extension of internalization theory in emerging markets: The role of firm-specific assets and asset dispersion in the multinationality-performance relationship

Kirca, Ahmet H.; Fernandez, Whitney Douglas; Kundu, Sumit K.

doi:10.1016/j.jwb.2016.03.003

Cited by 50 publications

(43 citation statements)

References 73 publications

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“…Also, the brewing industry has a number of unique characteristics that may influence the internationalization strategies employed (see Kirca et al . (), for a discussion on industry context in this regard). The local nature of beer and the emotional attachments consumers develop with their national beer brands create challenges for companies looking to export their products.…”

Section: Resultsmentioning

confidence: 99%

“…However, there is a need to develop further research on African MNEs with larger samples and from multiple host countries; this will allow for the development of the arguments presented here. Also, the brewing industry has a number of unique characteristics that may influence the internationalization strategies employed (see Kirca et al (2016), for a discussion on industry context in this regard). The local nature of beer and the emotional attachments consumers develop with their national beer brands create challenges for companies looking to export their products.…”

Section: Resultsmentioning

confidence: 99%

“…It also raises a question about the nature of the advantages that EMNEs possess and how this is affected by home country institutional environments. The relative institutional underdevelopment of their home countries may give rise to situation‐specific advantages and may impact their international expansion and how they appropriate value from their exclusive assets in foreign markets (Kirca, Fernandez, and Kundu, : 629).…”

Section: Introductionmentioning

confidence: 99%

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Institutional Complementarity and Substitution as an Internationalization Strategy: The Emergence of an African Multinational Giant

Luiz

Stringfellow

Jefthas

2017

Global Strategy Journal

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Research Summary We examine the internationalization decisions made by one of Africa's most successful companies, South African Breweries, as it underwent a period of aggressive expansion. We see processes of both institutional complementarity and substitution at different phases and with different motives. At first it sought countries that played to its strength, namely the knowledge of doing business in environments of institutional uncertainty, but later it pursued an institutional diversification strategy whereby it attempted to minimize its institutional risk exposure. As it became larger, its aspirations increased too, and its over‐exposure to emerging market institutional risk saw it engage in institutional substitution into advanced countries. Through this phased international process, it was able to develop its internal assets, and this enabled the moves into developed markets. Managerial summary We demonstrate that firms can exploit their knowledge of ‘weak’ institutional settings and turn it into a source of advantage as they internationalize into locations with similar institutional ‘weaknesses.’ Using the case of one of Africa's most successful multinational enterprises, we illustrate the value gained from initially capitalizing upon institutional complementarity (utilizing the comparative advantage linked to institutional know‐how) by exploiting the experience of the home country's environment into similar settings. Over time and through learning‐by‐doing, pressure arose to diversify the risk linked with over‐exposure to institutional uncertainty and country risk, and this was associated with the process of institutional substitution into more advanced countries. We see emerging multinational learning and building its capabilities by leveraging its understanding of its home country institutional environment. Copyright © 2016 John Wiley & Sons, Ltd.

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Section: Resultsmentioning

confidence: 99%

Section: Resultsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Institutional Complementarity and Substitution as an Internationalization Strategy: The Emergence of an African Multinational Giant

Luiz

Stringfellow

Jefthas

2017

Global Strategy Journal

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“…However, the scarce resources are attached to the international organization of enterprises, such as intangible assets or specific talents. In response to this concern, some scholars have studied that firm-specific assets indirectly improve performance through internationalization (Buckley & Tian, 2017a, 2017bKirca et al, 2016). Based on the views above, this study suggests that firm-specific assets of ESCOs, including the firm size, specific products, growth ratio and saving rate, are all correlated with the degree of internationalization; therefore, we propose hypothesis H1 as following:…”

Section: Literature Reviewmentioning

confidence: 88%

The Internationalization-Performance Relationship of Small-and-Medium-sized Enterprises: The Case of Taiwan’s ESCO Industry

Yeh¹,

Hu²,

Chen³

2020

Journal of Applied Finance &Amp; Banking

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We analyze the international output patterns with Taiwan’s energy service companies (ESCOs) investigated in 2016~2019. Due to the finite demand in Taiwan energy-saving market, half of Taiwanese ESCOs develop Asia Pacific markets with international trade, alliance and enterprises group. We derive and confirm some hypotheses about international developing patterns of Taiwanese ESCOs. The First is that those firms with more specific resources will be easier to promote the internationalization of energy-saving businesses. The specific resources are confirmed as firm capital, annual ESCO sales, net income ratio, annual growth rate, energy saving rate. Secondly, if the degree of internationalization of ESCOs is greater, the overall profitability is also relatively higher. The third, the relationship between internationalization and profitability of ESCOs displays a non-linear trend which means when the export ratio is low, the profit from energy service projects increases; however, when the ratio exceeds the optimal point, about 49.584%~54.323%, it will reveals a reversed phenomenon due to high overseas operation costs.

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“…Institutional Voids and Differences (Marano et al, 2017, Meyer and Peng, 2016, Ma et al, 2016, Li and Oh, 2016, Kirca et al, 2016, Shirodkar and Mohr, 2015, Liao, 2015, Deng and Yang, 2015, Cassia and Magno, 2015, Anderson and Sutherland, 2015, Agnihotri and Bhattacharya, 2015, Gaur et al, 2014, Wu and Chen, 2014, Tuschke et al, 2014, Sartor and Beamish, 2014, Sandberg, 2014, Li et al, 2014b…”

Section: Institutionalmentioning

confidence: 99%

Reviewing emerging markets: context, concepts and future research

Nielsen

Hannibal

Larsen

2018

IJOEM

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Purpose The purpose of this paper is to provide a systematic review of the substantial and growing body of emerging market (EM) research. Through assessing the literature an organizing framework is formed to support a nuanced basis for future research and management decisions in EMs. Design/methodology/approach Following guidelines of seminal authors, the authors conduct a systematic review involving both leading field-specific and top-tier international business journals. Findings The empirical context of the literature is outlined showing dominance of studies involving China and India. Seminal contributions are identified based on cross-references in the EM field and citations in international business literature in general. The definitional elements of the most dominant definitions are compiled into an organizing framework. Research limitations/implications Researchers need to acknowledge the distinct contextual setting of specific regions and countries labeled as EMs. This entails considerations into the capacity of current frameworks to lend insights not just on EM contexts but the particular EM context in focus. Practical implications The findings suggest a more nuanced approach to managing activities in EM contexts. The proposed framework encloses the EM category on its distinct dimensions. Each provides a unique basis for managerial decision-making on specified EM activities. Originality/value This paper provides the first systematic review of the ever-growing body of EM research literature to map and assess the existing intellectual territory. Through this, the authors contribute to the development of the existing body of knowledge and form a solid basis for future research.

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An empirical analysis and extension of internalization theory in emerging markets: The role of firm-specific assets and asset dispersion in the multinationality-performance relationship

Cited by 50 publications

References 73 publications

Institutional Complementarity and Substitution as an Internationalization Strategy: The Emergence of an African Multinational Giant

Institutional Complementarity and Substitution as an Internationalization Strategy: The Emergence of an African Multinational Giant

The Internationalization-Performance Relationship of Small-and-Medium-sized Enterprises: The Case of Taiwan’s ESCO Industry

Reviewing emerging markets: context, concepts and future research

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