A Comparative Analysis of Ethnic Networks and Internationalization of Latin American Agri-SMEs: The Case of Argentina, Brazil, and Chile

This paper investigates the key drivers influencing the internationalization of agricultural small and medium-sized enterprises (agri-SMEs) in Latin America, with a particular emphasis on the role of social and ethnic networks. Focusing on Argentina, Brazil, and Chile—three of the region’s largest agricultural economies—this study examines how familial and cultural connections between descendants of European immigrants and European entrepreneurs facilitate the global expansion of agri-SMEs. Using a cross-sectional quantitative analysis, data from agri-SME managers reveal the importance of these networks in reducing market entry barriers by providing insider knowledge of foreign markets, regulatory conditions, and potential business partnerships. The findings demonstrate that ethnic networks significantly reduce market entry barriers, providing Latin American agri-SMEs access to essential insider knowledge on foreign markets and local regulations, thereby facilitating internationalization. Additionally, agri-SMEs that leverage these networks are better positioned to meet growing global demands for sustainable, traceable food products, gaining a competitive advantage in international markets. The strength and frequency of interactions within ethnic networks are positively correlated with the degree of internationalization, highlighting the importance of social capital in overcoming operational challenges. This paper contributes to the literature by highlighting the underexplored role of ethnic networks in shaping the international marketing strategies of agricultural firms and their capacity to adapt to evolving consumer behaviors. The study offers practical insights for supporting the global integration of agri-SMEs in Latin America, addressing both operational challenges and the increasing need for sustainable food production practices.