Chapter 3 The Value of Commercial Diplomacy from an International Entrepreneurs Perspective

Abstract

One powerful public support instrument to support the economic interests abroad is via commercial diplomacy (CD). CD is practice gaining more importance in today's economy, but is poorly addressed in research. The available existing research, however, lack detail on the beneficiary perspective and the value-added function of CD, let alone specific enterprises to small and medium enterprises (SMEs). This study contributes to the field of CD by identifying the determinants of the value of CD from an SME (beneficiary) perspective. Out of a random sample of 450 SMEs contacted, 115 of them agreed to fill out a scale-based questionnaire and answer to open questions in the questionnaire. The results demonstrate that the perceived service quality by SMEs of CD influences the overall value SMEs attach to CD. No evidence was found in support of the hypothesis that institutional environment of a host country is negatively related to the value SMEs attach to CD. But we found a negative relationship between the international experience of an SME and the overall value SMEs attach to CD, and a positive relationship between the extent of having foreign public customers and the overall value attached to CD by SMEs. Opposite to what existing literature suggests, smaller SMEs do not attach more value to CD services. Also, for the business network we did not find evidence that SMEs with an established business network attach less value to CD. We did, however, find evidence that SMEs with an established business network attach less value to partner search services. Suggestions for further research are provided.

Citation

Busschers, S. and Ruël, H. (2012), "Chapter 3 The Value of Commercial Diplomacy from an International Entrepreneurs Perspective", Ruël, H. (Ed.) Commercial Diplomacy and International Business: A Conceptual and Empirical Exploration (Advanced Series in Management, Vol. 9), Emerald Group Publishing Limited, Leeds, pp. 71-103. https://doi.org/10.1108/S1877-6361(2012)0000009007