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This study aims to use analogical reasoning to draw a conceptual link between liabilities in International Business (IB) and export barriers.

Following a review of 130 articles on export barriers, the study develops and applies a “liabilities” metonymy to connect the source construct (liabilities in the IB) and target subject (export barriers).

Liabilities in the IB map to export barriers, and the concepts of liability of foreignness, liability of outsidership, liability of newness and liability of smallness can substitute export barriers.

Adoption of metonymy creates new opportunities for enhancing theory development while offering alternative perspectives regarding coping mechanisms for overcoming export barriers.

This, to the author’s best knowledge, is the first study in the IB to theorize based on metonymy.

This conceptual paper aims at providing the readers of the Journal of Management History with an evaluation of the overall impact of Arthur Stinchcombe's liability of newness construct on the management literature about organizational evolution over time.

The paper adopts an historical approach for discussing the development of those theoretical and empirical trajectories which, drawing on Stinchcombe's seminal underpinnings, have been developed by scholars over the second half of the twentieth century. The most recent enhancements on this topic are also discussed.

The analysis demonstrates that the impact of the liability of newness on the related literature is great and twofold. On the one hand, it emerges that this concept has directly inspired a number of subsequently formulated constructs, such as the liabilities of smallness, adolescence and aging. On the other hand, it is evidenced that Stinchcombe's seminal insights still constitute one of the most fascinating bases for directing and positioning scholarly efforts within the organizational evolution research domain to date.

The value of this paper is that it adopts a unique way for examining the development of a number of theoretical frameworks and empirical inquiries variously associated with the liability of newness over time. Three time decades are historically identified and the links among them are deepened.

This study aims to analyze the individual and joint effects of institutional support by government and nongovernment institutions on early internationalizing firms’ (EIFs) performance. It also investigated the moderating impact of firm age and size on the institutional support-firms’ export performance relationships.

Data were collected from 705 EIFs in the apparel industry of Bangladesh and analyzed with hierarchical regression.

The positive influence of institutional support on exporting firms’ financial performance is stronger for the joint effect of government and nongovernment assistance than the individual impact. Firms’ size positively moderates the impact of individual government and nongovernment assistance, while age positively moderates their resource-bundling effect.

The findings suggest the necessity of integrating resources from diverse but complementary sources of institutional support for superior export performance. The findings also show the presence of the liability of smallness and liability of newness in the standalone and joint influence of institutional support, respectively.

Firms need to bundle resources obtained from the government (unrequited) and nongovernment (reciprocal) institutional support to overcome the liability of smallness they might encounter while availing of support from only one source.

Distinguishing between government and nongovernment institutional support, this paper sheds light on exporting firms’ resource-bundling mechanism for these two sources of support in the backdrop of an emerging economy. It also offers fresh insights into the critical role of the liabilities of newness and smallness in early internationalization, especially with regard to the home-country institutional environment.

The aim of this paper is two‐fold: to examine the challenges that organizations that have originated in transition environments face when moving from one layer of the environment (local/national) to another one (international/global) and to enrich the understanding of the legitimacy concept by looking at two types of legitimacy (functional and relational) relevant to the organizations in transition environments trying to access the global marketplace.

Drawing on the legitimacy needs of organizations evolving in transition environments and trying to access a different environmental layer, we developed a signalling theory of legitimacy.

When trying to move from one layer of the environment to another one, organizations will use different types of legitimacy signals in order to address the liabilities they face.

The research examines organizations facing both drastic environmental changes and evolving in a global industry. Future research can separately study the impact of each factor; and also investigate additional types of liabilities.

The study can help organizations from transition and emerging economies identify and employ signals that can enhance their organizational legitimacy, which may affect their performance. Additionally, public policy implications are developed in order to stimulate local businesses.

The multidimensionality of a signalling theory of legitimacy – functional and relational – increases our understanding of organizations facing liabilities, such as firms evolving in transition environments and trying to access the global marketplace.

The purpose of this paper is to examine and explain why most small firms remain small. A new conceptual framework – the condition of smallness – is proposed.

A critical examination of the literature about the nature of being a small firm is first conducted. Employing an inductive analysis of responses from a survey of 2,521 small business owners about employment regulation, the nature and effects of smallness is examined.

It was found that owners' choice making combines with perceptions about their resources to produce a condition of smallness. The condition of smallness is conceptualised as the circularity perceptions, attitudes and consequent practices that reflect lack of knowledge, time and capability. It is argued that this condition of smallness inhibits growth to create a wicked problem that explains why most small firms don't grow.

This work is largely conceptual, albeit the argument is grounded in, and illustrated by, empirical data. The findings may not be generalisable beyond this paper's data sets, but may be generalisable conceptually.

The focus of much scholarly work has been on growth firms. Yet the typical small firm is excluded so that the issues of smallness are often overlooked. This paper, therefore contributes to understanding why small firms don't grow.

Reaching customers globally and building a global brand and market presence is a demanding task for any firm. For early and rapidly internationalising small firms this is exceptionally challenging due to the restraints that ensue from the liabilities of smallness, newness and foreignness and the speed of their internationalisation. We argue that entrepreneurial marketing is a driver of entrepreneurial internationalisation and one of the – neglected – explanations for superior international performance. The authors conceptualise entrepreneurial marketing along four core (marketing) abilities which fit particularly well the international new firm and show how these positively impact on early and accelerated internationalisation and alter the risk profile of the venture in general.

The authors advance a model theorizing how new ventures elicit citizenship behaviors to cultivate dynamic capabilities that help bolster survival in their nascent years of operations—a characteristically resource-scarce and turbulent context.

Drawing on and integrating research on citizenship behaviors with dynamic capabilities, the authors develop a theory that new ventures that are better able to evoke a combination of affiliative and challenging citizenship behaviors from their wider entrepreneurial team (i.e. internal, and external stakeholders) are more adept at mitigating the liabilities of smallness and newness. As these behaviors are spontaneous and not explicitly remunerated, new ventures become stronger at utilizing their limited resource base for remaining lean and agile. Further, key boundary conditions are theorized that the sociocultural norms the venture is embedded within serve to heighten/attenuate the degree to which entrepreneurs can effectively cultivate dynamic capabilities from their team's “extra mile” behaviors.

The propositions extend a rich body of research on citizenship behaviors into the new venture domain. As all new ventures face the challenge of overcoming liabilities of newness, models that help understand why some are more adept at overcoming this and why others fail, hold substantive practical utility.

This research is the first to unpack how citizenship behaviors manifest among an extended range of stakeholders traditionally overlooked in new venture teams research and the mechanism for how this links to venture survival.

The purpose of this paper is to investigate how access to financing for incremental as well as radical innovation activities is affected by firm-specific structural and behavioral characteristics.

Deploying a two-stage Heckman probit model on survey data spanning the period 2000–2013 and covering 1,169 firms, this paper analyzes the effect of a firm’s engagement in incremental and radical innovation on its likelihood to get constrained in their access to external finance, and how this effect is moderated by the firm’s age and size.

In line with earlier research, it is confirmed that the type of innovation matters for the access to external finance, but in a more nuanced way than generally portrayed. While incremental innovation activities have little negative effect on the access to external finance, radical innovation activities tend to be penalized by capital markets. This effect appears to be particularly strong for small firms.

This paper provides nuanced insights into the interplay between types of firm-level innovation activities, structural characteristic and access to external finance.

The purpose of this paper is to employ an inductive approach to explore how small, nascent, firms in the craft brewing industry use cooperative behaviours with direct competitors to achieve their goals.

Data were gathered from interviews with the founders of seven small, newly established, craft brewers in a Midwestern city in the USA for this exploratory study. Data analysis followed the general tenants of inductive coding. Porter’s value chain model was used as a framework to organise and conceptualise the coopetitive behaviour uncovered.

The firms engage in cooperative behaviours with their direct competitors in areas such as process technology development, procurement, inbound logistics and marketing. A particularly interesting and common collaborative activity was breweries recommending/promoting competing breweries to their own customers.

This study provides clear examples of how relationship building with competitors could be advantageous and help small, nascent firms overcome the liabilities of newness and smallness.

Research on coopetition has called for a greater understanding of the nature of cooperative behaviours in small firms, start-ups and firms outside of high-technology industries. Moreover, research has called for finer-grained approaches to conceptualising coopetition. This paper fills these gaps and shows how Porter’s value chain is a useful tool for organising the types of collaborative behaviours that can be part of coopetition. The findings enhance understanding and facilitate future research by illustrating a broad array of cooperative activities that occur between direct competitors.

International Business, Entrepreneurship.

This case has been used previously in an international business strategy module on MA courses at Kozminski University, Poland.

The case details Audioteka’s (a Polish audiobook company) history between 2007 and 2013, from the perspective of Marcin, one of the co-founders. The company was founded in 2008 by Marcin Beme and Blazej Kukla and internationalized soon after. Marcin was an experienced entrepreneur, while Blazej was a sound engineer. Both sought to combine their complementary skills and experience to start a business aimed at selling audio recordings. The case is divided into Parts (A) and (B) and is designed to teach international entrepreneurship, lying at the intersection of international business and entrepreneurship. Part (A) is set in 2011 and tracks the company’s evolution from the conception of an idea to establishing a start-up and developing a product. Part (B) is set in 2013 and covers early foreign expansion between 2011 and 2013. The case is focused on the challenges that Marcin faces when developing Audioteka and expanding abroad. It allows students to understand the decision-making logic of an international new venture (INV), choices made and execution while internationalizing. Students will be able to explore how a company adapts its product; how it enters foreign markets; how it overcomes the liabilities of foreignness, smallness, newness and outsidership through establishing partnerships with big companies (telecoms, automakers); and how it appreciates the risks involved in this process.

This case is the basis for a class discussion rather than for illustrating either effective or ineffective handling of a managerial situation. From this case, MA students will learn how an entrepreneurial firm makes strategic decisions and becomes international. The first learning outcome is to evaluate the concepts of liability of origin, foreignness, outsidership, smallness and newness, and to explore ways of overcoming them. Second, the expected learning outcome is to assess differences between the Uppsala model of internationalization and born-global/INV phenomenon. Third, students, by examining particular foreign market-entry modes, are expected to evaluate their advantages and disadvantages. Finally, students are expected to understand the concept of “effectuation” and apply it to the decision-making process in early internationalization.

CSS 5: International Business.