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Internationalisation of developing economy small and medium-sized enterprises: social capital and learning in Palestinian pharmaceutical firms

Grace Khoury (Faculty of Business and Economics, Birzeit University, Birzeit, Palestinian National Authority)
Mira T. El-Far (Business Administration and Marketing, Faculty of Business and Economics, Birzeit University, Birzeit, Palestinian National Authority)
Elena Noor Khoury (Business Administration and Marketing, Faculty of Business and Economics, Birzeit University, Birzeit, Palestinian National Authority)
George Tovstiga (EDHEC Business School, Paris, France)

Journal of Small Business and Enterprise Development

ISSN: 1462-6004

Article publication date: 20 November 2020

Issue publication date: 17 March 2021

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Abstract

Purpose

The paper examines the role of learning through social capital on the internationalisation process of small and medium-sized enterprises (SMEs) based within extreme contexts. The study focuses on the Palestinian pharmaceutical industry.

Design/methodology/approach

The inductive, exploratory research used in this study adopts a case study approach. Data derived from semi-structured in-depth interviews held with senior management and companies' founders were analysed using content and thematic analysis techniques.

Findings

The findings suggest that accumulated learning by SMEs seeking international expansion is enhanced with stronger social capital ties and networks through structural, relational and cognitive mechanisms. Serendipity and liability effects enabled modes of foreign entry with higher degrees of commitment than efficacy-related factors.

Practical implications

The Palestinian pharmaceutical industry presents a benchmark for other industries in comparable developing economy contexts. This study elucidates the important interrelationship between social capital and learning for SMEs seeking to expand internationally; the findings have implications for regional policymaking in developing economy regions.

Originality/value

The case study investigation focuses on the pharmaceutical industry and SMEs operating within the extreme context of Palestine, thereby contributing insights in an area of management enquiry that is under-represented in the extant literature.

Keywords

Acknowledgements

The authors thank Birzeit University scientific research fund for the partial support they provided.

Citation

Khoury, G., El-Far, M.T., Khoury, E.N. and Tovstiga, G. (2021), "Internationalisation of developing economy small and medium-sized enterprises: social capital and learning in Palestinian pharmaceutical firms", Journal of Small Business and Enterprise Development, Vol. 28 No. 2, pp. 298-316. https://doi.org/10.1108/JSBED-06-2020-0230

Publisher

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Emerald Publishing Limited

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