IDEAS home Printed from https://ideas.repec.org/a/kap/sbusec/v20y2003i3p219-31.html
   My bibliography  Save this article

A Dynamic Decision Model of SMEs' FDI

Author

Listed:
  • Kuo, Hsien-Chang
  • Li, Yang

Abstract

Many scholars generally believe that small and medium-sized enterprises (SMEs) in comparison to large firms are at a disadvantage in foreign direct investment (FDI). However, new evidence suggests that SMEs also play an important role in FDI. Why do they undertake risk in other countries? We are interested in what factors significantly motivate them to go abroad. Taiwan's SMEs play a vital role in her economic development and outward FDI, and this study therefore focuses on the outward FDI of Taiwan's SMEs. We apply the hazard rate approach to perform an empirical analysis, taking into consideration the conditional probability of the element of time. Among SMEs, the lower the degree of "capital intensities," the larger the "firm sizes," the higher the "export ratios," or the larger the level of "R&D intensities" are, the greater the intention will be to undergo FDI. The major factors motivating Taiwanese SMEs to conduct FDI in recent years are "utilizing local labor," "expanding markets," and "following major clients." Copyright 2003 by Kluwer Academic Publishers

Suggested Citation

  • Kuo, Hsien-Chang & Li, Yang, 2003. "A Dynamic Decision Model of SMEs' FDI," Small Business Economics, Springer, vol. 20(3), pages 219-231, May.
    • Handle: RePEc:kap:sbusec:v:20:y:2003:i:3:p:219-31
    as

    Download full text from publisher

    File URL: http://journals.kluweronline.com/issn/0921-898X/contents
    File Function: link to full text
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nadine Levratto & Clarisse Nguedam Ntouko & Maarouf Ramadan, 2017. "Institutions and firms’ internationalization: an empirical analysis on three Middle East countries," EconomiX Working Papers 2017-37, University of Paris Nanterre, EconomiX.
    2. Jaeyoung Cho & Jangwoo Lee, 2020. "Speed of FDI expansions and the survival of Korean SMEs: the moderating role of ownership structure," Asian Business & Management, Palgrave Macmillan, vol. 19(2), pages 184-212, April.
    3. Lin, Feng-Jyh, 2010. "The determinants of foreign direct investment in China: The case of Taiwanese firms in the IT industry," Journal of Business Research, Elsevier, vol. 63(5), pages 479-485, May.
    4. Kiss, Andreea N. & Danis, Wade M. & Cavusgil, S. Tamer, 2012. "International entrepreneurship research in emerging economies: A critical review and research agenda," Journal of Business Venturing, Elsevier, vol. 27(2), pages 266-290.
    5. Nader Ale Ebrahim & Shamsuddin Ahmed & Zahari Taha, 2009. "Virtual R & D teams in small and medium enterprises: A literature review," Post-Print hal-00593358, HAL.
    6. De Maeseneire, Wouter & Claeys, Tine, 2012. "SMEs, foreign direct investment and financial constraints: The case of Belgium," International Business Review, Elsevier, vol. 21(3), pages 408-424.
    7. Karolien Lenaerts & Bruno Merlevede, 2015. "Firm size and spillover effects from foreign direct investment: the case of Romania," Small Business Economics, Springer, vol. 45(3), pages 595-611, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:sbusec:v:20:y:2003:i:3:p:219-31. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.