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The purpose of this paper is to examine the curvilinear effects of firm innovativeness (i.e. product, organisational and marketing innovation) on international expansion as well as the effect of expansion on performance in the developing countries (DCs) setting.

Research hypotheses are tested using survey data obtained from firms located in four South-East European DCs. Covariance-based structural equation modelling is used to test the proposed conceptual framework.

Empirical findings support the hypothesised U-shaped relationship between product innovation and organisational innovation and the level of international expansion of firms in developing markets. The authors found an inverse U-shaped relationship between marketing innovation and the level of international expansion. Furthermore, the existence of a strong positive link between the level of international expansion and firm performance is also confirmed.

While this research utilises a sample of firms from a homogenous group of DCs, further research could use a more heterogeneous sample and thus control the model for various contingency effects (e.g. environment turbulence, market structure and competitive dynamics).

When it comes to product and organisational innovation, international expansion is achieved only with a higher level of innovativeness. On the contrary, beyond a certain level, further investments in marketing innovation do not have additional positive effects on international expansion.

This study is one of the first that explicitly focuses on examining the non-linear effects of innovativeness on international expansion in the DC context.

Whether and when the innovation aspiration shortfall (e.g. innovation performance lower than aspirations) will affect emerging economy firms (EEFs)' international expansion remains an important unanswered theoretical and practical question.

Based on performance feedback theory, this study explores the impact of innovation aspiration shortfall on EEFs' international expansion and the moderating role of CEO origin.

This study finds that innovation aspiration shortfall has a positive impact on EEFs' international expansion. This study also uncovers that EEFs are less likely to implement international expansion in response to innovation aspiration shortfall when the CEO is a founder than when the CEO is a non-founder, and EEFs are more likely to implement international expansion in response to innovation aspiration shortfall when the CEO is an outsider-CEO than when the CEO is an insider-CEO.

This study proposes that the interaction between innovation aspiration shortfall and CEO origin can be a useful predictor of EEFs' international expansion.

Internationalization is of high relevance and has been discussed intensively. However, different internationalization paths have been proposed by theoretical models and have been observed in reality. In this study, we examine the internationalization path of 52 German firms over a period of ten years using comprehensive and rich data on all new ventures established by these companies within this period. We find four distinct patterns of internationalization and propose a stage model of internationalization based on these findings. Our results show different challenges for managers depending on the stage of internationalization and render interesting starting points for further research.

The paper aims to critically analyse the relevant literature on the international expansion of China's small- and medium-sized enterprises with the aim of highlighting the main topics analysed by scholars and identifying areas for future research.

The paper reviews the works on the international growth of China's SMEs published in selected peer-reviewed English-language journals vis-à-vis what has been published on Western SMEs. It does this by, first, studying the literature at both firm and industry levels and, second, by analysing the specific characteristics of small business from China along with the particularities of the Chinese business environment.

The paper shows that two main areas are in need of further research: the impact of the Chinese business environment on the international expansion of SMEs, and the need to understand different elements of the process to develop a strong firm-level body of literature.

The paper highlights the need to deepen the understanding of the process leading to SMEs' expansion beyond China's borders to conclude with the identification of areas for future research.

The purpose of this study is to investigate the type of resources that firms draw on to expand internationally within the Association of Southeast Asian Nations (ASEAN) context. The authors seek to understand the impact of technological, political and knowledge resources on ASEAN firms’ multinationality, moderated by labor intensity, the type of ownership and the stage of economic development.

The hypotheses are tested on a sample that comprises 4,056 manufacturing firms in five ASEAN countries: Indonesia, Lao PDR, Philippines, Vietnam and Timor-Leste.

The authors found that technology resource is not positively associated with multinationality. However, this relationship is moderated by labor intensity and type of firm ownership. Political resources, such as lobbying activities and informal payment to government, are important for ASEAN firms for foreign expansion. However, excessive informal payment may prove to be counterproductive. The authors also found that local firms tend to exploit more political resources than foreign counterparts and firms operating in the lower stage of economic development tend to spend more on lobbying activities, but pay less informal contribution. Finally, for the manager industry experience, they found an inverted U-shaped relationship with respect to multinationality, but for manager education, the association was unexpectedly negative.

From a practical perspective, the findings have three important implications for management of ASEAN multinationals. First, multinationals can systematically exploit and internalize political ties by carefully integrating political activities, through informal contribution and lobbying, into their strategic planning or corporate structure. The findings suggest that political networking will offset weak technological resources, particularly for local firms. Second, managers of multinationals operating in ASEAN should not rely excessively on political actors, as the extra costs associated with the above optimum political resources exceed its marginal benefit. Moreover, excessive reliance on political actors will expose the firm to the threat of opportunism. Even though political resources are important managers need to maintain the utilization of political resources at the optimal level. Third, besides technological and political resources, managers’ knowledge is also crucial for ASEAN firms’ internationalization. The authors provide evidence showing that the positive effect of managerial experience is limited only to a certain level, even though tmanagers’ education has positive linear relationship with multinationality. This implies that at the early stage of international activities, both manager’s experience and education will have positive impact on the firm. However, when international activities are getting more complicated, the manager’s education takes over the manager’s experience. Above its optimum point, the manager’s experience will limit the manager’s capability to create innovative solutions for international expansion, and therefore it is the manager’s education that is able to stimulate revolutionary solution.

In this paper, the authors examine the resource impact on multinationality or the extent to which business activities span across national boundaries to shed light on the antecedents of foreign expansion in ASEAN. They discuss three types of resources (i.e. technological, political and knowledge resources) and seek to understand the impact of these resources on multinationality. Political resources are highlighted in addition to technological and knowledge resources in this paper because ASEAN firms are generally situated in a weak institutional environment in which the political resource is crucial for firms’ entry, operation and exit in international markets (Boddewyn and Brewer, 1994; Hillman and Keim, 1995; Rodriguez et al., 2005).

This study aims to understand whether business and political relations help emerging markets' SMEs to overcome the challenges posed by low institutionalization in their national and international expansion. It focuses on the role that these relations play in determining access to government funding and contracts and to market information and business-related knowledge.

The data were collected from 828 SMEs in Brazil and China. The data analysis was developed in two stages: the first stage was based on multivariate regression analyses using the ratio of sales outside the companies' region of origin divided by total sales as a dependent variable and the survey's answers as independent variables; outward sales were taken at two different levels – national and international – to consider: (1) the different stages in the national and international expansion process, and (2) the fragmented nature of domestic markets in both Brazil and China. The second stage was based on a stepwise multiple regression as the relative importance of the variables was not known beforehand and the objective was to rank them according to the managers' perceptions.

Informal institutions, in particular business and political relations, can help to reduce uncertainty and overcome some disadvantages associated with weak institutionalization. They do this by providing access to trusted distribution channels, improving the familiarity with different institutional environments and strengthening the management of supply chains and commercial strategies to serve markets outside their region. Also, SMEs in emerging markets getting access to private sources of funding, market knowledge and government contracts through business and political relations are in a better position to expand nationally and internationally.

The research shows that the domestic environment, in particular one with low levels of institutionalization, impacts negatively the national and international expansion of SMEs and, more importantly, how firms can use business and political relations to overcome the obstacles posed by this environment. The findings also have implications for theory, practice and policymaking.

Consistent with traditional internationalization theory, we argue that, when a firm chooses franchising to achieve market penetration, market propinquity/similarity matters. Using a modified gravity model, we examine six country characteristics believed to enhance the flow of franchise activity among 39 nations. Our findings support the notion that market propinquity facilitates the flow of franchises between nations. Franchise expansion is greatest when the home and host nations are similar in terms of geography, culture, media availability, and political risk. The management implications of these findings are discussed in detail.

Given the importance of understanding the dynamics of the internationalisation and expansion process, it is surprising that – in reviewing the extensive literature – that little attention has been paid to service organisations. This paper attempts to shed light on business strategies and the international entry modes of the services sector in general, and the area of banking which form a significant and substantive proportion of global trade. Therefore, this paper aims to address this omission by exploring the behaviour of Malaysian multinational financial and banking service industries in their international expansion in terms of their motivation, mode of entry strategies, selection of target markets, and their strategic thrusts.

The paper follows an exploratory approach utilising qualitative multiple case studies. Empirical data are presented from case study of four large Malaysian‐based multinational commercial banks through interviews with managers from the banks' headquarters as well as managers responsible for and/or engaged in the development and implementation of international marketing strategies.

It is inferred that Malaysian multinational commercial banks are entering foreign markets, employing a foreign direct investment entry mode, by creating branches and representative offices, and in some cases by acquiring part of the share or the whole capital of existing local financial institutions. These expansions have been motivated by several factors related to both their domestic markets (push factors: government initiatives, small size, low and limited growth) and the attractiveness of their target markets (pull factors/location advantages: high market growth, low to moderate levels of competition).

The case study has inherently limited the capacity to offer generalisations concerning other service companies.

This paper is rich in its practical implications. As this study was concerned with the practical experience and behaviour of Malaysian‐based multinational banks on their choice of entry modes and organisational forms when internationalising, Malaysian banking and marketing practitioners can use the analysis and results as a means of comparing their current tactical and strategy foreign entry behaviour with that of other internationalising banks.

The paper offers new insights into the emergence and international expansion of Malaysian‐based multinational commercial banks, and sheds light on the internationalisation process associated with services per se.

Overconfidence as an important psychological factor can also affect CEO’s cognitive preferences, while there are few studies about the impact of CEO’ overconfidence on the international expansion of companies. This paper aims to fill this gap and further discuss the moderating role of CEO’s overseas experience, CEO duality and ownership.

The authors focus on the Chinese context, collect 2008–2016 data from China's manufacturing industry as sample, use fixed effect model to analyse the effect of CEO overconfidence on international expansion strategy of Chinese firms.

The empirical results show that: CEO overconfidence positively promotes the degree of firm internationalization. CEO foreign experience positively affects the internationalization degree, but can restrain overconfidence thus negatively regulate this impact relationship. When duality is present, both CEO power and managerial discretion are pronounced and they exhibit a stronger effect. Firm’s equity nature will affect the relationship between CEOs' overconfidence and the degree of internationalization. Compared with private enterprises, CEOs in state-owned enterprises have limited power, therefore, this influence relationship is weaker.

This study has emphasized the importance of top executives' psychological characteristics on firm internationalization, which is key application and complement of upper echelons theory and fills the research gap in the literature. In this paper, the authors found the advantages of overconfidence for firms, which helps to understand the complex meaning of overconfidence. The results of moderating effect further explore the application of overconfidence in different context, which has some implications for management practice.

The purpose of this paper is to understand whether and how specific capabilities at the firm level can sustain firms during the process of international expansion in emerging markets (EMs).

A quantitative study was carried out, and the authors analyzed data from a sample of 271 manufacturing firms. A logistic regression was used to check for differences in the endowment of resources and capabilities of firms solely focussing on advanced markets (AMs) or extending their international scope to EMs as well.

Firms that expanded their business in EMs showed a significantly higher endowment of international experience and marketing capabilities compared with firms that focussed only on AMs. The authors found that the size of the firm is irrelevant: even small firms can reach EMs by leveraging an appropriate set of capabilities.

The study is cross-sectional and cannot provide a longitudinal view of the process of capability development. Future research will be needed to detail the process of capability development during the international expansion of firms into EMs.

Regardless of size, firms that plan to enter EMs should develop specific capabilities, especially marketing capabilities, to increase the likelihood of success. Already internationalized firms have a considerable advantage due to the knowledge they have accumulated in other markets.

This paper advances understanding of the process of the international expansion of firms in EMs from a resource-based perspective.