International diversification and performance: A study of global law firms
AbstractThis paper is an exploration of the internationalization-performance relationship in the context of contemporary knowledge intensive services. After background literature, we build theory in the context of service firms to explain how performance in international diversification largely depends on building various relevant organizational competencies. We develop two hypotheses: one concerning a reverse u-shaped internationalization-performance function for these firms in general, and another differentiating between U.S. and U.K. firms. Data on 76 U.S. and 13 U.K. firms are analyzed using hierarchical regression. The findings sustain the reverse u-shaped internationalization-performance relationship for these firms in general, but also suggest that the prospects are quite different for U.S. versus U.K. firms. Our findings add to an emerging stream of research that indicates a resolution to the hitherto ambiguous internationalization-performance relationship; and we also suggest a convergence between findings in capital-intensive and knowledge-intensive industries. The paper concludes with some implications for practitioners.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal Journal of International Management.
Volume (Year): 12 (2006)
Issue (Month): 4 (December)
Contact details of provider:
Web page: http://www.elsevier.com/wps/find/journaldescription.cws_home/601266/description#description
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- John R. Graham & Michael L. Lemmon & Jack G. Wolf, 2002. "Does Corporate Diversification Destroy Value?," Journal of Finance, American Finance Association, vol. 57(2), pages 695-720, 04.
- Frances A Katrishen & Nicos A Scordis, 1998. "Economies of Scale in Services: A study of Multinational Insurers," Journal of International Business Studies, Palgrave Macmillan, vol. 29(2), pages 305-323, June.
- José Manuel Campa & Simi Kedia, 1999.
"Explaining the Diversification Discount,"
99-06, New York University, Leonard N. Stern School of Business, Department of Economics.
- N Capar & M Kotabe, 2003. "The relationship between international diversification and performance in service firms," Journal of International Business Studies, Palgrave Macmillan, vol. 34(4), pages 345-355, July.
- Catherine Matraves & Peter Rodriguez, 2005. "Profitability, Diversification, and Multinationality in Leading German and UK Firms," International Journal of Business and Economics, College of Business, and College of Finance, Feng Chia University, Taichung, Taiwan, vol. 4(2), pages 87-105, August.
- Blomstermo, Anders & Eriksson, Kent & Lindstrand, Angelika & Sharma, D. Deo, 2004. "The perceived usefulness of network experiential knowledge in the internationalizing firm," Journal of International Management, Elsevier, vol. 10(3), pages 355-373.
- Luo, Yadong, 2002. "Organizational dynamics and global integration: A perspective from subsidiary managers," Journal of International Management, Elsevier, vol. 8(2), pages 189-215.
- Hadley, Richard D. & Wilson, Heather I. M., 2003. "The network model of internationalisation and experiential knowledge," International Business Review, Elsevier, vol. 12(6), pages 697-717, December.
- Masaaki Kotabe & Srini S Srinivasan & Preet S Aulakh, 2002. "Multinationality and Firm Performance: The Moderating Role of R&D and Marketing Capabilities," Journal of International Business Studies, Palgrave Macmillan, vol. 33(1), pages 79-97, March.
- MB Sarkar & S Tamer Cavusgil & Preet S Aulakh, 1999. "International Expansion of Telecommunication Carriers: The Influence of Market Structure, Network Characteristics, and Entry Imperfections," Journal of International Business Studies, Palgrave Macmillan, vol. 30(2), pages 361-381, June.
- Farok J Contractor & Sumit K Kundu & Chin-Chun Hsu, 2003. "A three-stage theory of international expansion: the link between multinationality and performance in the service sector," Journal of International Business Studies, Palgrave Macmillan, vol. 34(1), pages 5-18, January.
- Nachum, Lilach, 2003. "Does nationality of ownership make any difference and, if so, under what circumstances?: Professional service MNEs in global competition," Journal of International Management, Elsevier, vol. 9(1), pages 1-32.
- Wang, Chi-Feng & Chen, Li-Yu & Chang, Shao-Chi, 2011. "International diversification and the market value of new product introduction," Journal of International Management, Elsevier, vol. 17(4), pages 333-347.
- Christian Genthon, 2008. "International diversification, performance and offshoring : the case of the computer services industry," Post-Print halshs-00348198, HAL.
- Chao, Mike Chen-Ho & Kumar, Vikas, 2010. "The impact of institutional distance on the international diversity-performance relationship," Journal of World Business, Elsevier, vol. 45(1), pages 93-103, January.
- Lin, Wen-Ting & Liu, Yunshi & Cheng, Kuei-Yang, 2011. "The internationalization and performance of a firm: Moderating effect of a firm's behavior," Journal of International Management, Elsevier, vol. 17(1), pages 83-95, March.
- LiPuma, Joseph A., 2012. "Internationalization and the IPO performance of new ventures," Journal of Business Research, Elsevier, vol. 65(7), pages 914-921.
- Segal-Horn, Susan & Dean, Alison, 2009. "Delivering 'effortless experience' across borders: Managing internal consistency in professional service firms," Journal of World Business, Elsevier, vol. 44(1), pages 41-50, January.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.