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An empirical examination of the influence of industry and firm drivers on the rate of internationalization by firms

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  • Elango, B.

Abstract

Foreign direct investment made by firms globally rose by 40 percent to $315 billion in 1995 compared with the previous year. In spite of the apparent importance of globalization, very little research has examined the factors with potential to influence the rate of internationalization of firms. Using 158 large U.S.-based multinational firms drawn from seven different industries, this study explains about 24 percent of the variance of the rate of internationalization. Results indicate that global market growth rate, domestic market growth rate, relative size of domestic market to international market, employee productivity, administrative investments, as well as new plant and equipment influence the rate of internationalization of firms.

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  • Elango, B., 1998. "An empirical examination of the influence of industry and firm drivers on the rate of internationalization by firms," Journal of International Management, Elsevier, vol. 4(3), pages 201-221, November.
    • Handle: RePEc:eee:intman:v:4:y:1998:i:3:p:201-221
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    1. Balasubramanian Elango & S. Prakash Sethi, 2007. "An exploration of the relationship between country of origin (COE) and the internationalization-performance paradigm," Management International Review, Springer, vol. 47(3), pages 369-392, June.
    2. Elango, B. & Dhandapani, Karthik, 2020. "Does institutional industry context matter to performance? An extension of the institution-based view," Journal of Business Research, Elsevier, vol. 115(C), pages 139-148.
    3. Zúñiga-Vicente, José Ángel & Benito-Osorio, Diana & Guerras-Martín, Luis Ángel & Colino, Alberto, 2019. "The effects of international diversification on the link between product diversification and performance in a boom and bust cycle: Evidence from Spanish firms (1994–2014)," Journal of International Management, Elsevier, vol. 25(4).
    4. Kerai, Anita & Kumar, Vikas & Singla, Chitra, 2023. "Impact of TMT structural power asymmetry on family firm internationalization," International Business Review, Elsevier, vol. 32(4).
    5. Ele Reiljan, 2006. "The role of entrepreneurial actions in the de-internationalization of Estonian enterprises: entrepreneurs’ perceptions," University of Tartu - Faculty of Economics and Business Administration, in: Tõnis Mets & Janita Andrijevskaja & Urve Venesaar & Ene Kolbre (ed.), Entrepreneurship in Estonia: policies, practices, education and research, edition 1, volume 28, chapter 7, pages 139-153, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    6. Aaltonen, Päivi Hanna Maria, 2020. "Piecing together a puzzle—A review and research agenda on internationalization and the promise of exaptation," International Business Review, Elsevier, vol. 29(4).
    7. Alice Civera & Michele Meoli & Silvio Vismara, 2019. "Do academic spinoffs internationalize?," The Journal of Technology Transfer, Springer, vol. 44(2), pages 381-403, April.
    8. Zhang, Yijing & Toppinen, Anne & Uusivuori, Jussi, 2014. "Internationalization of the forest products industry: A synthesis of literature and implications for future research," Forest Policy and Economics, Elsevier, vol. 38(C), pages 8-16.

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