IDEAS home Printed from https://ideas.repec.org/a/kap/sbusec/v50y2018i3d10.1007_s11187-017-9909-z.html
   My bibliography  Save this article

Are growth expectations being met? Implications for the internationalization of micro-sized ventures

Author

Listed:
  • Marleen McCormick

    (Butler University)

  • Stephanie A. Fernhaber

    (Butler University)

Abstract

Despite the rapid growth of international entrepreneurship research in the last two decades, little attention has been paid to the internationalization of micro-sized ventures. Given the influence of the entrepreneur within these micro-sized ventures, an especially relevant question is how entrepreneurial perceptions impact international growth. Drawing on organizational learning and performance feedback theory, we hypothesize that entrepreneurs who perceive the venture to have either not met or to have exceeded growth expectations will subsequently internationalize more than entrepreneurs who perceive growth expectations to have simply been met. A sample of 226 international, micro-sized ventures from the Kauffman Firm Survey is used to test the hypotheses. The results confirm a U-shaped relationship between entrepreneurial perceptions and internationalization. The relationship is more pronounced among innovative micro-sized ventures than non-innovative ones. This study adds to the international entrepreneurship research stream with an emphasis on the entrepreneur and specifically highlights the role of perceptions.

Suggested Citation

  • Marleen McCormick & Stephanie A. Fernhaber, 2018. "Are growth expectations being met? Implications for the internationalization of micro-sized ventures," Small Business Economics, Springer, vol. 50(3), pages 591-605, March.
    • Handle: RePEc:kap:sbusec:v:50:y:2018:i:3:d:10.1007_s11187-017-9909-z
    DOI: 10.1007/s11187-017-9909-z
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11187-017-9909-z
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11187-017-9909-z?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

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

    References listed on IDEAS

    as
    1. Tristan Boyer & Régis Blazy, 2014. "Born to be alive? The survival of innovative and non-innovative French micro-start-ups," Small Business Economics, Springer, vol. 42(4), pages 669-683, April.
    2. Zoltán J. Ács & Siri Terjesen, 2015. "Born local: toward a theory of new venture’s choice of internationalization," Chapters, in: Global Entrepreneurship, Institutions and Incentives, chapter 13, pages 242-256, Edward Elgar Publishing.
    3. Cassar, Gavin, 2006. "Entrepreneur opportunity costs and intended venture growth," Journal of Business Venturing, Elsevier, vol. 21(5), pages 610-632, September.
    4. Forlani, David & Mullins, John W., 2000. "Perceived risks and choices in entrepreneurs' new venture decisions," Journal of Business Venturing, Elsevier, vol. 15(4), pages 305-322, July.
    5. Theresa K. Lant, 1992. "Aspiration Level Adaptation: An Empirical Exploration," Management Science, INFORMS, vol. 38(5), pages 623-644, May.
    6. George H. Rice Jr. & Richard E. Hamilton, 1979. "Decision Theory and the Small Businessman," Entrepreneurship Theory and Practice, , vol. 4(1), pages 1-9, July.
    7. John Joseph & Vibha Gaba, 2015. "The fog of feedback: Ambiguity and firm responses to multiple aspiration levels," Strategic Management Journal, Wiley Blackwell, vol. 36(13), pages 1960-1978, December.
    8. Joel A. C. Baum & Kristina B. Dahlin, 2007. "Aspiration Performance and Railroads’ Patterns of Learning from Train Wrecks and Crashes," Organization Science, INFORMS, vol. 18(3), pages 368-385, June.
    9. Jane E. Dutton & Liam Fahey & V. K. Narayanan, 1983. "Toward understanding strategic issue diagnosis," Strategic Management Journal, Wiley Blackwell, vol. 4(4), pages 307-323, October.
    10. Vibha Gaba & John Joseph, 2013. "Corporate Structure and Performance Feedback: Aspirations and Adaptation in M-Form Firms," Organization Science, INFORMS, vol. 24(4), pages 1102-1119, August.
    11. Audia, Pino G. & Brion, Sebastien, 2007. "Reluctant to change: Self-enhancing responses to diverging performance measures," Organizational Behavior and Human Decision Processes, Elsevier, vol. 102(2), pages 255-269, March.
    12. Scott Shane, 2009. "Why encouraging more people to become entrepreneurs is bad public policy," Small Business Economics, Springer, vol. 33(2), pages 141-149, August.
    13. Stephanie A Fernhaber & Brett Anitra Gilbert & Patricia P McDougall, 2008. "International entrepreneurship and geographic location: an empirical examination of new venture internationalization," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 39(2), pages 267-290, March.
    14. Jones, Marian V. & Coviello, Nicole & Tang, Yee Kwan, 2011. "International Entrepreneurship research (1989–2009): A domain ontology and thematic analysis," Journal of Business Venturing, Elsevier, vol. 26(6), pages 632-659.
    15. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    16. Karl E. Weick & Kathleen M. Sutcliffe, 2006. "Mindfulness and the Quality of Organizational Attention," Organization Science, INFORMS, vol. 17(4), pages 514-524, August.
    17. Gaglio, Connie Marie & Katz, Jerome A, 2001. "The Psychological Basis of Opportunity Identification: Entrepreneurial Alertness," Small Business Economics, Springer, vol. 16(2), pages 95-111, March.
    18. Dimitratos, Pavlos & Lioukas, Spyros & Carter, Sara, 2004. "The relationship between entrepreneurship and international performance: the importance of domestic environment," International Business Review, Elsevier, vol. 13(1), pages 19-41, February.
    19. Levinthal, Daniel & March, James G., 1981. "A model of adaptive organizational search," Journal of Economic Behavior & Organization, Elsevier, vol. 2(4), pages 307-333, December.
    20. Suresh Kotha & Violina P Rindova & Frank T Rothaermel, 2001. "Assets and Actions: Firm-Specific Factors in the Internationalization of U.S. Internet Firms," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 32(4), pages 769-791, December.
    21. Matthew S. Kraatz & Edward J. Zajac, 2001. "How Organizational Resources Affect Strategic Change and Performance in Turbulent Environments: Theory and Evidence," Organization Science, INFORMS, vol. 12(5), pages 632-657, October.
    22. Jane W. Lu & Paul W. Beamish, 2001. "The internationalization and performance of SMEs," Strategic Management Journal, Wiley Blackwell, vol. 22(6‐7), pages 565-586, June.
    23. Charles Braymen & Kristie Briggs & Jessica Boulware, 2011. "R&D and the Export Decision of New Firms," Southern Economic Journal, John Wiley & Sons, vol. 78(1), pages 191-210, July.
    24. Henrich R. Greve, 2007. "‘Exploration and exploitation in product innovation’," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 16(5), pages 945-975, October.
    25. Kristina Dahlin & Joel A.C Baum, 2007. "Aspiration performance and railroads' patterns of learning from train wrecks and crashes," Post-Print hal-00480399, HAL.
    26. Hanas Cader & John Leatherman, 2011. "Small business survival and sample selection bias," Small Business Economics, Springer, vol. 37(2), pages 155-165, September.
    27. Sarah Kaplan, 2008. "Framing Contests: Strategy Making Under Uncertainty," Organization Science, INFORMS, vol. 19(5), pages 729-752, October.
    28. Dasí, Àngels & Iborra, María & Safón, Vicente, 2015. "Beyond path dependence: Explorative orientation, slack resources, and managerial intentionality to internationalize in SMEs," International Business Review, Elsevier, vol. 24(1), pages 77-88.
    29. Silviano Esteve-Pérez & Diego Rodríguez, 2013. "The dynamics of exports and R&D in SMEs," Small Business Economics, Springer, vol. 41(1), pages 219-240, June.
    30. Acedo, Francisco J. & Jones, Marian V., 2007. "Speed of internationalization and entrepreneurial cognition: Insights and a comparison between international new ventures, exporters and domestic firms," Journal of World Business, Elsevier, vol. 42(3), pages 236-252, September.
    31. Wennberg, Karl & Delmar, Frédéric & McKelvie, Alexander, 2016. "Variable risk preferences in new firm growth and survival," Journal of Business Venturing, Elsevier, vol. 31(4), pages 408-427.
    32. Susan Coleman & Alicia Robb, 2009. "A comparison of new firm financing by gender: evidence from the Kauffman Firm Survey data," Small Business Economics, Springer, vol. 33(4), pages 397-411, December.
    33. Cassar, Gavin, 2014. "Industry and startup experience on entrepreneur forecast performance in new firms," Journal of Business Venturing, Elsevier, vol. 29(1), pages 137-151.
    34. Don Knight & Craig L. Pearce & Ken G. Smith & Judy D. Olian & Henry P. Sims & Ken A. Smith & Patrick Flood, 1999. "Top management team diversity, group process, and strategic consensus," Strategic Management Journal, Wiley Blackwell, vol. 20(5), pages 445-465, May.
    35. repec:mpr:mprres:5716 is not listed on IDEAS
    36. Stephanie A. Fernhaber & Dan Li, 2010. "The Impact of Interorganizational Imitation on New Venture International Entry and Performance," Entrepreneurship Theory and Practice, , vol. 34(1), pages 1-30, January.
    37. Hielke Buddelmeyer & Paul H. Jensen & Elizabeth Webster, 2010. "Innovation and the determinants of company survival," Oxford Economic Papers, Oxford University Press, vol. 62(2), pages 261-285, April.
    38. Simon, Mark & Houghton, Susan M. & Aquino, Karl, 2000. "Cognitive biases, risk perception, and venture formation: How individuals decide to start companies," Journal of Business Venturing, Elsevier, vol. 15(2), pages 113-134, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Diego A. B. Marconatto & Gaspar A. Peixoto & Emidio G. Teixeira & Adelar Fochezatto, 2022. "Women on the Front Line: The Growth of SMEs during Crises," Sustainability, MDPI, vol. 14(16), pages 1-18, August.
    2. Williams, David W. & Crook, T. Russell, 2021. "Unpacking the age at initial internationalization-performance relationship: A meta-analytic investigation," Journal of Business Venturing Insights, Elsevier, vol. 15(C).
    3. Alan A. Ahi & Noemi Sinkovics & Rudolf R. Sinkovics, 2023. "E-commerce Policy and the Global Economy: A Path to More Inclusive Development?," Management International Review, Springer, vol. 63(1), pages 27-56, February.
    4. Elio Shijaku & Martin Larraza-Kintana & Ainhoa Urtasun-Alonso, 2020. "Network centrality and organizational aspirations: A behavioral interaction in the context of international strategic alliances," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 51(5), pages 813-828, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Daniel A. Levinthal & Claus Rerup, 2021. "The Plural of Goal: Learning in a World of Ambiguity," Organization Science, INFORMS, vol. 32(3), pages 527-543, May.
    2. Farhad Uddin Ahmed & Louis Brennan, 2021. "A review of methodological diversity within the domain of international entrepreneurship," Journal of International Entrepreneurship, Springer, vol. 19(2), pages 256-299, June.
    3. Martínez-Noya, Andrea & García-Canal, Esteban, 2021. "Innovation performance feedback and technological alliance portfolio diversity: The moderating role of firms’ R&D intensity," Research Policy, Elsevier, vol. 50(9).
    4. Abraham Carmeli & Ari Dothan & Dev Kumar Boojihawon, 2020. "Resilience of sustainability‐oriented and financially‐driven organizations," Business Strategy and the Environment, Wiley Blackwell, vol. 29(1), pages 154-169, January.
    5. Saemundsson, Rögnvaldur & Candi, Marina & Sigurjonsson, Throstur Olaf, 2022. "The influence of performance feedback and top management team orientation on decisions about R&D in technology-based firms," Technovation, Elsevier, vol. 113(C).
    6. Songcui Hu & Zi-Lin He & Daniela P. Blettner & Richard A. Bettis, 2017. "Conflict inside and outside: Social comparisons and attention shifts in multidivisional firms," Strategic Management Journal, Wiley Blackwell, vol. 38(7), pages 1435-1454, July.
    7. Walrave, Bob & Gilsing, Victor A., 2023. "Game of skill or game of luck? Distant search in response to performance feedback," Technovation, Elsevier, vol. 121(C).
    8. Linda Argote & Henrich R. Greve, 2007. "A Behavioral Theory of the Firm ---40 Years and Counting: Introduction and Impact," Organization Science, INFORMS, vol. 18(3), pages 337-349, June.
    9. Christian Schwens & Florian B. Zapkau & Michael Bierwerth & Rodrigo Isidor & Gary Knight & Rüdiger Kabst, 2018. "International Entrepreneurship: A Meta–Analysis on the Internationalization and Performance Relationship," Entrepreneurship Theory and Practice, , vol. 42(5), pages 734-768, September.
    10. Rubina Romanello & Maria Chiarvesio, 2019. "Early internationalizing firms: 2004–2018," Journal of International Entrepreneurship, Springer, vol. 17(2), pages 172-219, June.
    11. Kim, Euisin & Rhee, Mooweon, 2017. "How airlines learn from airline accidents: An empirical study of how attributed errors and performance feedback affect learning from failure," Journal of Air Transport Management, Elsevier, vol. 58(C), pages 135-143.
    12. Tom Van Caneghem & Walter Aerts & Oveis Madadian, 2021. "Peer‐based comparison and firms' discretionary cost decisions," Australian Economic Papers, Wiley Blackwell, vol. 60(1), pages 163-185, March.
    13. Wei-Ru Chen, 2008. "Determinants of Firms' Backward- and Forward-Looking R&D Search Behavior," Organization Science, INFORMS, vol. 19(4), pages 609-622, August.
    14. Abhijith Anand & Rajeev Sharma & Rajiv Kohli, 2017. "What Influences Managerial Use of Business Analytic Systems? A Theory of Performance-Driven Search," Working Papers in Economics 17/12, University of Waikato.
    15. John Joseph & Ronald Klingebiel & Alex James Wilson, 2016. "Organizational Structure and Performance Feedback: Centralization, Aspirations, and Termination Decisions," Organization Science, INFORMS, vol. 27(5), pages 1065-1083, October.
    16. Elizabeth Lim & Pino G. Audia, 2020. "Problem-Solving or Self-Enhancing? Influences of Diversification and Bright Spot on Corporate Resource Allocation Responses to Performance Shortfalls," Strategy Science, INFORMS, vol. 5(4), pages 348-368, December.
    17. David W. Lehman & Jungpil Hahn & Rangaraj Ramanujam & Bradley J. Alge, 2011. "The Dynamics of the Performance--Risk Relationship Within a Performance Period: The Moderating Role of Deadline Proximity," Organization Science, INFORMS, vol. 22(6), pages 1613-1630, December.
    18. Esteban Lafuente & Jasmina Berbegal-Mirabent, 2019. "Assessing the productivity of technology transfer offices: an analysis of the relevance of aspiration performance and portfolio complexity," The Journal of Technology Transfer, Springer, vol. 44(3), pages 778-801, June.
    19. Acedo, Francisco J. & Coviello, Nicole & Agustí, María, 2021. "Caution ahead! The long-term effects of initial export intensity and geographic dispersion on INV development," Journal of World Business, Elsevier, vol. 56(6).
    20. Montserrat Manzaneque & Alfonso A. Rojo-Ramírez & Julio Diéguez-Soto & Maria J. Martínez-Romero, 2020. "How negative aspiration performance gaps affect innovation efficiency," Small Business Economics, Springer, vol. 54(1), pages 209-233, January.

    More about this item

    Keywords

    Internationalization; Entrepreneurial perceptions; Micro-sized ventures; Kauffman firm survey;
    All these keywords.

    JEL classification:

    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • M16 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - International Business Administration

    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:50:y:2018:i:3:d:10.1007_s11187-017-9909-z. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc 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 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.