Business group affiliation and export propensity in new ventures

Jonas Eduardsen, Svetla Marinova, Božidar Vlačić, Miguel González-Loureiro

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

Abstract

The purpose of this study is to examine how business group (BG) affiliation influences the export propensity of new ventures (NVs). To help address the inconsistency of past research on the value of BG affiliation for firms seeking to expand their business abroad, the authors provide a contingency perspective by exploring how organizational characteristics and BG characteristics condition the value of BG affiliation. The authors analyze the impact of BG affiliation on the export propensity of NVs, including the factors that condition this impact, by using a sample of 2,874 European NVs. The primary contribution of this study is to determine the impact of BG affiliation on the export propensity of NVs, including the moderating effects of firm size on the BG affiliation–export propensity relationship. The findings show that the export propensity of NVs affiliated with BGs is significantly higher than for stand-alone NVs. However, the findings demonstrate that the impact of BG affiliation on export propensity depends on the network characteristics of the BG in terms of the geographical dispersion of network ties. Consequently, the findings suggest that BG affiliation provides advantages for NV exporting only if it provides access to international inter-firm networks thus acting as a compensatory mechanism for liability of outsidership and liability of newness in foreign markets. In such cases, BG affiliation is a major resource capital that equipoises the somewhat limited financial resource provision for NV internationalization.
Original languageEnglish
Title of host publicationProgress in international business research
PublisherEmerald Group Holdings Ltd.
Pages129-153
Number of pages25
Volume15
ISBN (Electronic)9781800432444
ISBN (Print)9781800432451
DOIs
Publication statusPublished - 2021

Publication series

NameProgress in International Business Research
Volume15
ISSN (Print)1745-8862

Keywords

  • Business group affiliation
  • Domestic networks
  • Export propensity
  • International networks
  • Network resourceinternationalization
  • New ventures
  • Internationalization

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