Measuring the Degree of Internationalization of a firm: A Comment

A socioemotional wealth perspective on how collaboration intensity, trust, and international market knowledge affect family firms’ multinationality

“…Measuring multinationality is a contested and largely unresolved issue in international business research (Hassel et al, 2003;Ramaswamy, Kroek, & Renforth, 1996;Sullivan, 1994;Verbeke & Brugman, 2009), with little consensus on which measure is best given equivocal conceptualization and inadequate measurement in empirical studies (e.g., Contractor, Kundu, & Hsu, 2003;Ruigrok & Wagner, 2003;Sullivan, 1994). The problem goes beyond consensus to one of form.…”

Cross-border acquisitions and financial leverage of UK acquirers

“…This approach relies on segmental data in databases to construct proxy variables for firms' degree of internationalisation. However, some concerns have been raised about the validity of the internationalisation proxies that are constructed from segmental data (see Sullivan, 1994;Ramaswamy et al, 1996;Chen et al, 1997). For instance, the definition of a geographic segment adopted by both previous and current accounting standards on segment reporting (see IAS 14, paragraph 35 and IFRS 8, paragraph 13) could imply that international firms with foreign assets or sales of less than 10% may be classified as domestic firms.…”

Internationalization trajectories--a cross-country comparison: Are large Chinese and Indian companies different?

“…While a range of other indicators of internationalization has been developed (see e.g Ietto-Gillies, 1998;Hitt et al, 1997), these two measures remain the most often used ones in IB research to document the weighted corporate strategy in which the relative importance of subsidiaries is taken into account in terms of their contribution to overall sales and assets (see e.g. Sullivan, 1994;Ramaswamy et al, 1996; and UNCTAD' s TransNationality Index). Both variables do suffer from measurement problems that become more pronounced in longitudinal research (especially if firms change their method of reporting).…”