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Internationalization and performance of Korean SMEs: the moderating role of competitive strategy

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  • Jaeyoung Cho

    (Kyungpook National University)

  • Jangwoo Lee

    (Kyungpook National University)

Abstract

Drawing upon the liabilities of newness and smallness perspective, we explore the impact of the degree of internationalization (DOI) on the performance of small- and medium-sized enterprises (SMEs) and the moderating impact of competitive strategies. An analysis of data from Korean SMEs reveals an S-shaped relationship between DOI and performance. Moreover, SMEs emphasizing a differentiation strategy may have better performance when increasing the DOI, whereas the opposite is true for SMEs emphasizing a cost leadership strategy. The findings support a three-stage internationalization theory in the SME context and provide a contingency perspective on the performance implications of the optimal DOI.

Suggested Citation

  • Jaeyoung Cho & Jangwoo Lee, 2018. "Internationalization and performance of Korean SMEs: the moderating role of competitive strategy," Asian Business & Management, Palgrave Macmillan, vol. 17(2), pages 140-166, April.
    • Handle: RePEc:pal:abaman:v:17:y:2018:i:2:d:10.1057_s41291-018-0036-8
    DOI: 10.1057/s41291-018-0036-8
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