Internationalization and Performance: The S‐curve Hypothesis and Product Diversity Effect

Abstract

This study uses data from 255 global pharmaceutical/biotechnological companies to (1) determine the impact of internationalization on firm performance and (2) explore the moderating effect that product diversity has on the relationship between internationalization and company performance. The results highlight the rewards of pursuing internationalization and demonstrate that companies benefit from internationalization activities by achieving higher overall performance. This finding contrasts with recent empirical evidence that an S‐curve relationship exists. Analysis of the moderating effect of product diversity indicates a strong effect on the internationalization‐performance relationship and thus shows that the payoff from internationalization is moderated by product diversity

Citation

Hsu, C. (2006), "Internationalization and Performance: The S‐curve Hypothesis and Product Diversity Effect", Multinational Business Review, Vol. 14 No. 2, pp. 29-46. https://doi.org/10.1108/1525383X200600007