An exploration of the relationship between country of origin (COE) and the internationalization-performance paradigm

Balasubramanian Elango and S. Prakash Sethi
Additional contact information
Balasubramanian Elango: Illinois State University
S. Prakash Sethi: City University of New York

Management International Review, 2007, vol. 47, issue 3, No 4, 369-392

Abstract: Abstract Abstract and Key Results The relationship of internationalization with firm performance continues to be a major focus of corporate strategy. While internationalization raises important issues of risk and uncertainty, cross-cultural aspects of employee conduct and consumer behavior, market structure and competition, and political and regulatory dimensions, it also provides new opportunities for growth, profitability and organizational learning. This study seeks to contribute to the topic by empirically investigating the influence of the country of origin effect (COE) on the internationalization and performance relationship. COE, as defined here, is a composite variable that serves as a proxy for differential conditions that might exist in the MNC’s home country, conditions which would impact the MNC’s performance through internalization of attributes connected with its home country. The findings of this study offer strong support for the underlying notion that a MNC’s home country impacts the internationalization-performance relationship. In particular, a positive linear relationship was found between internationalization and performance in countries with relatively small economies and which have extensive trade in their economy, while an inverted U-shaped relationship was found in countries with larger economies which have relatively moderate trade in their economy.

Keywords: Country of Origin Effect (COE); Internationalization; Performance; Small Open Economies; Large Economies; GDP; Trade in Goods (search for similar items in EconPapers)
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (40)

Downloads: (external link)
http://link.springer.com/10.1007/s11575-007-0021-5 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:manint:v:47:y:2007:i:3:d:10.1007_s11575-007-0021-5

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/11575

DOI: 10.1007/s11575-007-0021-5

Access Statistics for this article

Management International Review is currently edited by Michael-Jörg Oesterle and Joachim Wolf

More articles in Management International Review from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().