SME internationalization and performance : Growth vs. profitability
Research output: Journal Publications and Reviews (RGC: 21, 22, 62) › 21_Publication in refereed journal › peer-review
Author(s)
Detail(s)
| Original language | English |
|---|---|
| Pages (from-to) | 27-48 |
| Journal / Publication | Journal of International Entrepreneurship |
| Volume | 4 |
| Issue number | 1 |
| Publication status | Published - Mar 2006 |
| Externally published | Yes |
Link(s)
Abstract
Lu and Beamish (2001) examined the effect of two internationalization strategies, exporting and foreign direct investment (FDI), on SME performance (ROA). We extend this research by examining the differential effects of these strategies on two other dimensions of SME performance: growth and ROS. We develop and test four sets of hypotheses using a sample of 164 Japanese SMEs. We find that exporting activity has a positive impact on growth, but negative impact on profitability. FDI activity has a positive relationship with growth, but a U curve relationship with profitability. Exporting activity has a positive moderating effect on the relationship between an SME's FDI activity and firm growth, a negative moderating effect on the relationship between an SME's FDI activity and firm profitability. An SME's age when it starts to make FDIs has a negative moderating impact on the relationship between FDI and firm growth and profitability.
Research Area(s)
- Exporting, FDI, International, Japan, SME, Strategy
Citation Format(s)
SME internationalization and performance : Growth vs. profitability. / Lu, Jane W.; Beamish, Paul W.
In: Journal of International Entrepreneurship, Vol. 4, No. 1, 03.2006, p. 27-48.Research output: Journal Publications and Reviews (RGC: 21, 22, 62) › 21_Publication in refereed journal › peer-review
