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| Pace, rhythm, and scope: Process dependence in building a profitable multinational corporation |
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| Author(s): Vermeulen F, Barkema H |
| Source: STRATEGIC MANAGEMENT JOURNAL Volume: 23 Issue: 7 Pages: 637-653 Published: JUL 2002 |
| Times Cited: 48 References: 97 |
| Abstract: Many potential benefits of foreign expansion have been identified in the literature, yet empirical support that multinational firms perform better than domestic firms is mixed. This paper takes a longitudinal perspective and argues that how much a firm benefits from having foreign subsidiaries depends on its process of internationalization. We argue that a firm's capacity to absorb expansion is subject to constraints: some expansion patterns increase profitability less than others, owing to diseconomies of time compression. We hypothesize that the speed of internationalization, the spread of the geographical and product markets entered, and the irregularity of the expansion pattern negatively moderate a firm's increase in profitability resulting from international expansion. Model estimations based on panel data raised strong support for these predictions. Copyright (C) 2002 John Wiley Sons, Ltd. |
| Document Type: Article |
| Language: English |
| Reprint Address: Vermeulen, F (reprint author), London Business Sch, Regents Pk, London NW1 4SA, England |
Addresses:
1. London Business Sch, London NW1 4SA, England
2. Tilburg Univ, Dept Org & Strategy, NL-5000 LE Tilburg, Netherlands |
| Publisher: JOHN WILEY & SONS LTD, BAFFINS LANE CHICHESTER, W SUSSEX PO19 1UD, ENGLAND |
| Subject Category: Business; Management |
| IDS Number: 563FZ |
| ISSN: 0143-2095 |
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