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The effect of specificity of experience on a firm's perceived importance of institutional knowledge in an ongoing business

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  • Sylvie Chetty

    (Department of Commerce, Massey University, Auckland, New Zealand)

  • Kent Eriksson

    (Centre for Banking and Finance, KTH – The Royal Institute of Technology, Stockholm, Sweden)

  • Jessica Lindbergh

    (Centre for Banking and Finance, KTH – The Royal Institute of Technology, Stockholm, Sweden)

Abstract

We study how three types of firm experience, ranging from the specific to the general, influence the perceived importance of institutional knowledge in the ongoing business of internationalising firms based on a sample of 101 small-to-medium-sized firms. The three types of firm experiences are international, country and ongoing business. The results show that firm experience within the ongoing business, and the experience from multiple past business deals in various countries, develop institutional knowledge, whereas experience from multiple past business deals in a specific country does not. The theoretical contribution of this paper is that it establishes a link between different kinds of experience and managerial cognition in terms of institutional knowledge. In addition, it emphasises that firms develop institutional knowledge from multiple diverse country experiences, and experience in the specific ongoing business rather than experiences at the level of the country. Journal of International Business Studies (2006) 37, 699–712. doi:10.1057/palgrave.jibs.8400214; (2006)

Suggested Citation

  • Sylvie Chetty & Kent Eriksson & Jessica Lindbergh, 2006. "The effect of specificity of experience on a firm's perceived importance of institutional knowledge in an ongoing business," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 37(5), pages 699-712, September.
  • Handle: RePEc:pal:jintbs:v:37:y:2006:i:5:p:699-712
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    Cited by:

    1. repec:spr:manint:v:51:y:2011:i:3:d:10.1007_s11575-011-0079-y is not listed on IDEAS
    2. Nuria Alcalde-Fradejas & Marisa Ramírez-Alesón, 2015. "Long-run profits in times of crisis: A comparison between European SMEs and large companies," Estudios de Economia, University of Chile, Department of Economics, vol. 42(1 Year 20), pages 79-97, June.
    3. Hitt, Michael A. & Li, Dan & Xu, Kai, 2016. "International strategy: From local to global and beyond," Journal of World Business, Elsevier, vol. 51(1), pages 58-73.
    4. repec:eee:worbus:v:52:y:2017:i:5:p:653-663 is not listed on IDEAS
    5. repec:spr:manint:v:55:y:2015:i:3:d:10.1007_s11575-014-0221-8 is not listed on IDEAS
    6. Bloemer, Josée & Pluymaekers, Mark & Odekerken, Armand, 2013. "Trust and affective commitment as energizing forces for export performance," International Business Review, Elsevier, vol. 22(2), pages 363-380.
    7. repec:eee:worbus:v:53:y:2018:i:4:p:568-580 is not listed on IDEAS
    8. Hsu, Chia-Wen & Lien, Yung-Chih & Chen, Homin, 2015. "R&D internationalization and innovation performance," International Business Review, Elsevier, vol. 24(2), pages 187-195.
    9. Lo, Fang-Yi, 2016. "Intra-MNE advantage transfer and subsidiary innovativeness: The moderating effect of international diversification," Journal of Business Research, Elsevier, vol. 69(5), pages 1712-1717.
    10. Eriksson, Kent & Jonsson, Sara & Lindbergh, Jessica & Lindstrand, Angelika, 2014. "Modeling firm specific internationalization risk: An application to banks’ risk assessment in lending to firms that do international business," International Business Review, Elsevier, vol. 23(6), pages 1074-1085.
    11. Johanson, Martin & Martín Martín, Oscar, 2015. "The incremental expansion of Born Internationals: A comparison of new and old Born Internationals," International Business Review, Elsevier, vol. 24(3), pages 476-496.
    12. Li, Peng-Yu & Meyer, Klaus E., 2009. "Contextualizing experience effects in international business: A study of ownership strategies," Journal of World Business, Elsevier, vol. 44(4), pages 370-382, October.
    13. Figueira-de-Lemos, Francisco & Johanson, Jan & Vahlne, Jan-Erik, 2011. "Risk management in the internationalization process of the firm: A note on the Uppsala model," Journal of World Business, Elsevier, vol. 46(2), pages 143-153, April.

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