The Effect of Context-Related Moderators On the Internationalization-Performance Relationship: Evidence From Meta-Analysis

Zusammenfassung

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After thirty years of research on the relationship between internationalization and firm performance, findings on direction and magnitude are still contradictory. This paper quantitatively reviews prior research in an attempt to reconcile the fragmented results. The researchers address the question if and how internationalization relates to firm performance by integrating findings from 36 studies using the method of meta-analysis. They find empirical support for a significant positive relationship at the aggregate level. Equally important, meta-analysis reveals that the relationship is moderated by R&D intensity, product diversification, country of origin, and firm age and size.

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Auszug

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The Effect of Context-Related Moderators On the Internationalization-Performance Relationship: Evidence From Meta-Analysis

Introduction

The relationship between internationalization activities and firm performance has been the subject of extensive discussion in the strategy and international business literature over the course of the last thirty years. Unfortunately, with close to a hundred studies, little consensus has emerged among researchers as to the nature of the relationship between internationalization and firm performance.

Studies in the 1970s emphasized the benefits of internationalization and thus hypothesized a linear positive relationship between the degree of internationalization and firm performance; however researchers in the 1980s and 1990s acknowledged that internationalization can be subject to risk and failure, thus recognizing possible drawbacks to success in internationalization. As a result of these divergent findings, researchers, in a search for an optimal degree of internationalization, have more recently begun to examine the benefit-cost trade-off of internationalization and its variations along the internationalization continuum. These researchers have tried to resolve empirical findings of either a significant positive linear effect (Buhner 1987, Vernon 1971) or significant negative linear effect (Brewer 1981, Ramaswamy 1992) by remodeling the shape of this relationship. Significant results vary from U-shaped curves (Capar/Kotabe 2003, Lu/Beamish 2001) to inverted U-shaped curves (Gomes/Ramaswamy 1999, Hitt/Hoskisson/Kim 1997) and cubic curves (Contractor/Kundu/Hsu 2003, Lu/Beamish 2004). Empirical findings are even more diverse. The assertion of non-linearity is challenged by empirical studies that tested for but could not confirm a curvilinear relationship (Hsu/Boggs 2003, Tallman/Li 1996, Wan/Hoskisson 2003).

The heterogeneity of empirical results on different types of curves, effect sizes, and even overall direction lead to differing views and conclusions in contemporary research. While prior research set out to establish a single universal relationship between internationalization and firm performance, a discussion emerges among international business researchers as to whether such a relationship really exists or whether there are simply several context-dependent relationships reflecting the conditions when and how internationalization and firm performance relate. The current state of research on the internationalization-performance relationship is often described as "inconsistent" (Harveston/Kedia/Francis 1999, p. 295), "mixed" (Doukas/Lang 2003, p. 154, Gomez-Mejia/Palich 1997, p. 310, Hsu/Boggs 2003, p. 23), "decidedly mixed" (Hitt et al. 1997, p. 772, Qian 2002, p. 618), "contradictory" (Geringer/Tallman/Olsen 2000, p. 51), "inconsistent and contradictory" (Ruigrok/Wagner 2003, p. 65), "inconclusive and contradictory" (Tallman/Li 1996, p. 180), and "conflicting" (Annavarjula/Beldona 2000, p. 48).

The extant literature gives different explanations for this confusion. One recurrent explanation is based on theoretical shortcomings (Gomes/Ramaswamy 1999) and differences in research methodology. Sullivan (1994), in his attempt to improve the content validity ...

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