Explaining International New Ventures from High-Technology Industries:he Case of Initial Exporters from U.S. based IPOs
Date Issued
2008
Date
2008
Author(s)
Chang, Sheng-Hsiung
Abstract
This dissertation develops a theoretical framework that explains the accelerated internationalization of international new ventures (INVs), or the born global firms. A international new venture, as defined in this dissertation, is a new venture that enters foreign market(s) shortly after its inception. To effectively manage INVs, an INV should exploit flexibility with the accelerated internationalization strategy, which helps INVs to obtain opportunities in international markets. In theory, this dissertation is constructed under several related theories: the accelerated internationalization perspective, the behavioral theory, and the resource based view. As for the data set, the empirical dataset is collected from several databases such as the SDC PLATINUM, S&P’s COUNPUSTAT, and HOOVERs’ company records. The selection processes suggest 331 firms fit the description of this thesis. This thesis then focuses on a sample of 331 INVs from U.S. high technology industries that were founded during the time period of 1980 to 2007. It attempts to investigate the extent to which theory helps enhance the understanding of the accelerated internationalization process. Four issues related to this investigation are: (1) what are the factors that motivate INVs to adopt accelerated internationalization strategies; (2) how different forms of slack resources (i.e. available, recoverable, and potential slack) influence internationalization speed, (3) Re-examine the slack-performance in the setting of INVs: curvilinear relationships? (4) Accelerated internationalization and INV performance relationship. Specifically:1) This study aims to explain the factors affecting the internationalization speed of international new ventures. Extant literature on international new ventures has focused on the debate of the phenomenon. This study contributes to the literature by extending the research focus to the internationalization speed of international new ventures. The results indicates that international new ventures’ R&D capability has a positive effect on their internationalization speed, while marketing capability does not have a significant impact on internationalization speed.2) To further knowledge about the bases of accelerated internationalization in international new ventures (INVs), this study addresses how different forms of slack resources (i.e. available, recoverable, and potential slack) influence internationalization speed. This thesis tries to explain accelerated internationalization by adopting from the behavioral theory perspective, or the behavioral theory of the firm (Cyert & March, 1963). Specifically, this thesis argues that INVs’ organization slack, or slack resources, may influence internationalization speed (defined as the difference between an INV’s establishment and the timing it undertakes the first international expansion activities). The results support the argument by recoverable slack and potential slack. In addition, the results also partially supports that firm age moderate the relationship between internationalization speed and firm performance. 3) Slack resources and their impacts on financial performance is a critical issue in the field of strategic management. While this area has remained unexplained in the setting of international new ventures (INVs), this study aims to explore the impacts from different forms of slack resources (i.e. available slack, recoverable slack, and potential slack) on firm performance, as well as the moderation effects of internationalization speed and firm age. Empirical data on 331 INVs from U.S. high-technology industries confirm the differing influences of forms of slack on firm performance. The results suggest a non-linear relationship between available slack and performance, and a non-linear relationship between recoverable slack and performance. Overall, our findings call for a contingency perspective to specify the nature of slack resources when discussing its impact on INV performance.4) In a setting of international new ventures (INVs) in U.S. high-technology industries, this study examines how accelerated internationalization affects performance, as well as the moderating role of other factors. Following previous studies, this study measures accelerated internationalization by its internationalization speed. The results indicate that a linear relationship, instead of the assumed non-linear relationships. Equally important, the results also indicate that R&D intensity and advertising intensity are significant moderators of accelerated internationalization-performance relationship. Extant literature has addressed the internationalization of INVs with a focus on the pre-internationalization phase. The results of this study provide advances in understanding the accelerated internationalization- performance relationship and incorporating moderating factors.
Subjects
International new venture
born global
international entrepreneurship
U.S. high-technology industry
resource-based view
behavioral theory
Type
thesis
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