Search results

1 – 10 of over 17000
Click here to view access options
Book part
Publication date: 9 November 2004

Robert E Hoskisson, Heechun Kim, Robert E White and Laszlo Tihanyi

Prior research on international diversification has focused primarily on multinational enterprises (MNEs) from developed economies, such as the U.S. and other developed…

Abstract

Prior research on international diversification has focused primarily on multinational enterprises (MNEs) from developed economies, such as the U.S. and other developed nations. As an increasing number of MNEs are now located in emerging economies, new theoretical frameworks are needed to better understand the motivations of these MNEs to diversify internationally. This paper contributes to the theory development of MNEs by examining the characteristics of international diversification by business groups from emerging economies. Using the resource-based view (RBV) of the firm and organizational learning theory, we suggest that the international diversification motives of business groups from emerging economies vary by host country context. Business groups from emerging economies are more likely to enter developed economies (rather than other emerging economies) when their primary aim is exploring new resources and capabilities, and more likely to enter other emerging economies (rather than developed economies) when their primary aim is to exploit existing group resources and capabilities. We also suggest that these motives influence business-group performance. We identify two important moderators of these relationships: product diversification and social capital. Because of the importance of the business-group organizational form in emerging economies, understanding business-group international diversification may lead to improved MNE theory.

Details

"Theories of the Multinational Enterprise: Diversity, Complexity and Relevance"
Type: Book
ISBN: 978-1-84950-285-6

Click here to view access options
Article
Publication date: 1 February 1993

S. Ade Olusoga

Investigates the influence of market concentration, marketdiversification and internationalization strategies on the performanceof multinational enterprises (MNEs). Using…

Downloads
1417

Abstract

Investigates the influence of market concentration, market diversification and internationalization strategies on the performance of multinational enterprises (MNEs). Using a sample of 450 large, medium and small MNEs, and three alternative definitions of market concentration and market diversification, results indicate that market diversification strategy produces better performance results for MNEs than market concentration strategy. In addition, MNEs using market concentration‐low internationalization strategy performed better than those using market concentration‐high internationalization strategy, and MNEs using market diversification‐low internationalization strategy performed better than those using market diversification‐high internationalization strategy. Discusses implications of the study′s findings for improved MNE performance.

Details

International Marketing Review, vol. 10 no. 2
Type: Research Article
ISSN: 0265-1335

Keywords

Click here to view access options
Article
Publication date: 1 March 1996

Paul G. Simmonds and Bruce T. Lamont

The performance effects of product‐market and international diversification were examined in a sample of 156 U.S. corporations. Three sets of performance measures were…

Abstract

The performance effects of product‐market and international diversification were examined in a sample of 156 U.S. corporations. Three sets of performance measures were used: (1) profitability, (2) risk‐adjusted returns, and (3) growth. Results suggest independent effects on profitability, and interactive effects on risk‐adjusted returns and growth. Results also clarify seemingly conflicting findings on product‐market and international diversification effects on performance.

Details

The International Journal of Organizational Analysis, vol. 4 no. 3
Type: Research Article
ISSN: 1055-3185

Click here to view access options
Article
Publication date: 29 August 2019

Pavlos Symeou and Hemant Merchant

Previous work in international business largely disregards the interplay between home-country conditions and firms’ geographical diversification – implying that…

Abstract

Purpose

Previous work in international business largely disregards the interplay between home-country conditions and firms’ geographical diversification – implying that, regardless of indigenous conditions, firms can modify their domestic performance (which the authors measure in terms of change in firms’ domestic productivity) merely by diversifying into international markets. The authors contest this view and argue that diversification does not substitute for home-country conditions. Rather, it moderates the baseline impact of home-country conditions on indigenous firms’ domestic performance. The purpose of this study is to describe these mechanisms and empirically examine their implications for indigenous firms’ performance.

Design/methodology/approach

The authors investigate the above model based on a 20-year longitudinal analysis of 600 observations involving telecommunication incumbents from 65 countries. They control for possible reverse causality between firms’ international diversification (and other firm-specific factors) and their domestic performance, and conduct several robustness checks.

Findings

The authors find – as hypothesized – that international diversification moderates the baseline performance impact of different home-country attributes in different ways. Such diversification does not have a uniform moderating effect on home-country attributes. In other words, the baseline effects of home-country conditions are altered as indigenous firms become more internationalized.

Originality/value

Theoretically, this work bridges the micro- and macro-level arguments that interweave strands from the competitive strategy and national competitive advantage literatures. By unpacking diversification’s role vis-à-vis the effect of upstream (home-country) conditions on firm performance, the authors attempt to shed light on the mechanisms that help (or hinder) indigenous firms’ performance. Empirically, this study helps to reconcile seemingly opposite views about whether and, if so, how much home-country conditions shape indigenous firms’ expansion after they have diversified internationally.

Details

Multinational Business Review, vol. 27 no. 4
Type: Research Article
ISSN: 1525-383X

Keywords

Click here to view access options
Article
Publication date: 5 June 2019

Vicky Ching Gu, Ray Qing Cao and John Wang

Although foreign ownership has been widely studied to show its impact on firm performance, the findings are mixed and the underlying rational to explain the impact is not…

Abstract

Purpose

Although foreign ownership has been widely studied to show its impact on firm performance, the findings are mixed and the underlying rational to explain the impact is not entirely clear. The purpose of this study is to determine if there is a direct relationship between foreign ownership and performance or if this relationship is indirect and affected by mediating and moderating variables such as international diversification and competitive environment.

Design/methodology/approach

Financial data, survey data and other financial measures for known indices are used in the research, and SPSS and SEM (Stata 15) analyses are used to test empirically derived hypotheses.

Findings

Results from this study indicate that the relationship between foreign ownership and firm performance is mediated by international diversification, such that higher levels of both foreign corporate and foreign institutional ownership lead to higher levels of international diversification, which then lead to higher levels of firm performance. Results from this study also indicate that the competitive environment moderates the relationship between a firm’s level of international diversification and performance, such that the effect of international diversification on performance is greater as the environment becomes more competitive.

Practical implications

This study provides empirical evidence for managers to seriously consider the impact of foreign ownership on decisions involving international diversification, along with competitive environment, when formulating and implementing organizational strategies.

Originality/value

This study extends prior research examining the effects of foreign ownership on firm performance by uniquely showing how international diversification mediates the relationship between foreign ownership and firm performance and how the competitive environment moderates the relationship between international diversification and firm performance.

Details

Review of International Business and Strategy, vol. 29 no. 2
Type: Research Article
ISSN: 2059-6014

Keywords

Click here to view access options
Article
Publication date: 24 April 2020

Florian Holzmayer and Sascha L. Schmidt

Professional football clubs have increasingly initiated two corporate diversification strategies to enfold growth opportunities besides traditional income sources…

Abstract

Purpose

Professional football clubs have increasingly initiated two corporate diversification strategies to enfold growth opportunities besides traditional income sources: business diversification and international diversification. Empirical findings from management and sport management literature provide inconclusive evidence on these strategies' financial performance effects, necessitating further research. The purpose of this article is therefore to investigate how both corporate diversification strategies affect the financial performance of professional football clubs.

Design/methodology/approach

A 15-year panel data set of English Premier League (EPL) clubs is examined, many of which have employed corporate diversification strategies. Measures for related business diversification (RBD) and unrelated business diversification (UBD) as well as international diversification are established from management literature. Based on fixed effects regression models, their effects on clubs' revenues and profitability are then examined.

Findings

U-shaped effects from RBD on revenues and profitability are found, but no effects from UBD. These findings empirically support the theoretically appealing superiority of RBD over UBD and, with increasing levels of RBD, over a focused strategy in management literature. With international diversification, an inverted U-shaped effect on revenues is identified.

Research limitations/implications

Despite focusing only on the EPL, these findings provide new evidence of non-linear financial performance effects from corporate diversification strategies adding to (sport) management literature and setting the stage for future research on these strategies in professional football.

Practical implications

These findings have significant implications for club managers' strategic growth opportunities such as new business models or geographic markets.

Originality/value

This is the first study to empirically examine the financial effects of corporate diversification strategies in the football market context.

Details

Sport, Business and Management: An International Journal, vol. 10 no. 3
Type: Research Article
ISSN: 2042-678X

Keywords

Click here to view access options
Article
Publication date: 16 October 2017

Peng-Yu Li and Fang-Yi Lo

The purpose of this paper is to incorporate the resource-based perspective with upper echelon theory to examine the effect of top management teams’ (TMTs) managerial…

Abstract

Purpose

The purpose of this paper is to incorporate the resource-based perspective with upper echelon theory to examine the effect of top management teams’ (TMTs) managerial resources on international diversification.

Design/methodology/approach

The authors sampled 360 listed companies in the USA that operated in the information technology industry in 2009, the year after the financial crisis.

Findings

The findings show that TMTs’ tenure has a negative impact on international diversification but international experience exerts a positive impact on international diversification. Furthermore, TMTs’ educational background diversity and international experience contribute to a reduction in the negative effect of tenure on international diversification.

Originality/value

Prior studies have investigated the role of TMT in international diversification, but they pay less attention to the interactive effect of the variety of managerial resources on international diversification. In particular, the authors examined the effect of a variety of management resources on the level of international diversification under the uncertain environment.

Details

Management Decision, vol. 55 no. 9
Type: Research Article
ISSN: 0025-1747

Keywords

Click here to view access options
Article
Publication date: 23 March 2012

Monica A. Zimmerman and Keith D. Brouthers

Although diversifying internationally appears to be beneficial, relatively few small and medium‐sized firms actually participate. Building on recent research exploring the…

Downloads
1059

Abstract

Purpose

Although diversifying internationally appears to be beneficial, relatively few small and medium‐sized firms actually participate. Building on recent research exploring the international diversification of small and medium‐sized enterprises (SMEs) the purpose of this paper is to examine the relation among ownership and management team gender heterogeneity, entrepreneurial orientation, and firm international diversity.

Design/methodology/approach

The authors' hypotheses were tested using data gathered from members of Women Impacting Public Policy (WIPP), a national (US) public policy organization that advocates for women in business.

Findings

Results indicate that top management team gender composition and entrepreneurial orientation are significantly related to international diversification but that ownership gender composition is not. The authors found that team entrepreneurial orientation may be useful when teams are more homogeneous on relations‐oriented characteristics such as gender.

Originality/value

The paper's findings suggest that women‐only management teams high in entrepreneurial orientation are more likely to pursue international diversification, dispelling the idea that international diversification is more difficult for women.

Details

International Journal of Gender and Entrepreneurship, vol. 4 no. 1
Type: Research Article
ISSN: 1756-6266

Keywords

Click here to view access options
Book part
Publication date: 14 December 2018

Ramazan Yildirim and Mansur Masih

The purpose of this chapter is to analyze the possible portfolio diversification opportunities between Asian Islamic market and other regions’ Islamic markets; namely USA…

Abstract

The purpose of this chapter is to analyze the possible portfolio diversification opportunities between Asian Islamic market and other regions’ Islamic markets; namely USA, Europe, and BRIC. This study makes the initial attempt to fill in the gaps of previous studies by focusing on the proxies of global Islamic markets to identify the correlations among those selected markets by employing the recent econometric methodologies such as multivariate generalized autoregressive conditional heteroscedastic–dynamic conditional correlations (MGARCH–DCC), maximum overlap discrete wavelet transform (MODWT), and the continuous wavelet transform (CWT). By utilizing the MGARCH-DCC, this chapter tries to identify the strength of the time-varying correlation among the markets. However, to see the time-scale-dependent nature of these mentioned correlations, the authors utilized CWT. For robustness, the authors have applied MODWT methodology as well. The findings tend to indicate that the Asian investors have better portfolio diversification opportunities with the US markets, followed by the European markets. BRIC markets do not offer any portfolio diversification benefits, which may be explained partly by the fact that the Asian markets cover partially the same countries of BRIC markets, namely India and China. Considering the time horizon dimension, the results narrow down the portfolio diversification opportunities only to the short-term investment horizons. The very short-run investors (up to eight days only) can benefit through portfolio diversification, especially in the US and European markets. The above-mentioned results have policy implications for the Asian Islamic investors (e.g., Portfolio Management and Strategic Investment Management).

Click here to view access options
Article
Publication date: 1 September 1995

Philip H. Siegel, Khursheed Omer, John T. Rigsby and Pochara Theerathom

The purpose of this paper was to explore the motivation and rationale behind international investment to better explain the conflicting results reported in previous…

Abstract

The purpose of this paper was to explore the motivation and rationale behind international investment to better explain the conflicting results reported in previous research and to provide some answers to the current debate on international diversification. Monthly return data and annual financial data of 424 NYSE‐listed companies over four 5‐year periods was examined, dividing the sample companies into three groups according to their degree of international diversification. Averages for monthly returns, market‐adjusted returns, total risk, and systematic risk were analyzed. An ongoing debate among students of multinational corporations (MNCs) focuses on whether the intent of corporate international diversification has been to increase stockholders' return or to reduce risk (Siegel et al. 1992; Shalchi and Hosseini 1990; Ndubiuzu 1990; and Theerathom et al. 1992). Based upon the observation of the pattern of holdings, Buckley (1988) argues that firms do not become MNCs to reduce risk. Risk reduction behavior would lead to a strategy of seeking investments in countries with uncorrected return patterns, as with some of the underdeveloped countries. Instead there has been a concentration of foreign direct investments in advanced market economies with high return correlations among each other. Buckley (1988) concludes, therefore, that MNCs are imperfect vehicles for risk diversification. Fatemi (1984) suggests that much of the international diversification made by corporations may have a defensive purpose. Their goal may be, for example, to maintain participation in some export markets or to match the previous move of a competitor, and not necessarily to increase the firm's revenue. The motivation for foreign corporate investments has been attributed to many specific factors, related both to the firm and the country. Included among these factors are: (a) economies of scale associated with large size and the ability to produce in several countries, (b) intangible assets, such as technological expertise or entrepreneurial skills, (c) market power due to the size of markets and previous experience with the domestic market, (d) industry grouping, (e) the availability of additional natural resources, as well as less costly labor and/or capital, (e) advantageous regulatory framework for the firm offered by the host country, and (f) the economic influence of the particular time period involved on firms and countries. The purpose of this paper is to provide additional evidence on whether international diversification has either increased stockholder's return or reduced their risk and to consider the possible influence of several factors. A sample of 424 companies was drawn from the New York Stock Exchange (NYSE), and was divided into three categories, i.e., domestic, intermediate, and multinational. Two return and two risk measures were then calculated for four periods of time (1968–1972, 1973–1977, 1978–1982, and 1983–1987) to examine the relationships between the degrees of international diversification and the measures of risk and return. One of our concerns was to try to address some of the discrepancies among prior research findings.

Details

Managerial Finance, vol. 21 no. 9
Type: Research Article
ISSN: 0307-4358

1 – 10 of over 17000