AIB 2012 Conference Proceedings - Academy of International ...

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An MNE that diversifies by entering a new product area usually first invests in one start country and
subsequently selects target countries in which to carry out an international rollout. We study 788 new product
area international rollouts by 90 German MNEs and find that rollout speed is positively affected by how closely
related the new product area is to the product areas in the firm's overall, start country, and target country
portfolios. We also find that geographic proximity between start and target country, as well as more already
established firm activities in the target country help increase rollout speed. (For more information, please
contact: Thomas Hutzschenreuter, WHU, Germany: th@whu.edu)
Foreign Entry Timing and Survival: The S-curve Hypothesis
Jing'an Tang, Sacred Heart University
While competitive dynamics literatures suggest firms to enter a foreign market as pioneers to gain first mover
advantages, agglomeration-based location studies, on the other hand, recommend them to enter a market
where a critical mass of their peers is already located, that is, to be late movers in order to benefit from the
agglomeration economies. Density dependence theory, however, advises being neither early nor late entrants,
but being entrants in-between for survival advantages. To resolve this apparent paradox, we draw upon
multiple theories to build a foreign entry and survival model to integrate these three entry positions. We argue
that multiple forces interact with one another during the foreign entry process, resulting in an S-shaped
curvilinear relationship between entry order and subsidiary survival. An empirical analysis of a sample of nearly
4,000 Japanese FDI entries in over 40 countries from 1985 to 2003 supports our model. (For more information,
please contact: Jing'an Tang, Sacred Heart University, USA: tangj3@sacredheart.edu)
Foreign Direct Investment: Domestic Alliance Experience as an Antecedent to International Expansion
Linda Rademaker, Tilburg University
Xavier Martin, Tilburg University
This paper examines how collaboration with MNEs may induce knowledge spillovers that can be used as the
foundation on which local firms can build their attempts to expand internationally. Using a sample of FDI in- and
outflows into China and the United States in the period 1978-2010 we analyze the likelihood of international
expansion of Chinese firms. We find a positive effect of joint venture experience on the propensity of Chinese
firms to conduct FDI in the United States, with strong country effects. In addition, we find that domestic alliance
experience influences the entry mode chosen upon internationalization. (For more information, please contact:
Linda Rademaker, Tilburg University, Netherlands: c.h.a.rademaker@uvt.nl)
Development and Validation of a Vertical and Horizontal Internationalization Metric
Edmund R. Thompson, University of Bath
The lack of valid and reliable measures of firm-level vertical and horizontal internationalization is impeding the
development and testing of hypothesized relationships between these two different dimensions of
internationalization and a range of important MNE characteristics, actions, and effects. Through a series of
qualitative and quantitative studies using data collected from a total of 3,146 senior MNE executives, this paper
develops and validates a scale to measure both vertical and horizontal internationalization. Subscales for each
type of internationalization prove to be unidimensional, reliable, temporally stable, and to have predictive, crosscultural,
cross-sectoral, and discriminant validity. (For more information, please contact: Edmund R. Thompson,
University of Bath, United Kingdom: e.r.thompson@bath.ac.uk)
AIB 2012 Conference Proceedings
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