Foreign expansion of small firms: The impact of domestic alternatives and prior foreign business involvement

This research analyzes foreign expansions of small firms. In particular, we look at how a small firm's foreign expansion is affected by the join effec ts of prior foreign business involvement and other factors. We found that w hen encountering performance downturn and market si;e decline, small firms with prior foreign business involvement are more likely to use foreign expa nsion to deal with the problems. This suggests that organizational characte ristics mediate the relationship between competitive threats and foreign ex pansion activities. We also found that small firms' foreign diversification is affected by their product and domestic expansions, suggesting foreign a ctivities of small firms are closely related to their non-foreign strategie s. (C) 2001 Elsevier Science Inc.