Diplomatic Relations and Firm Internationalization Speed: The Moderating Roles of Trade Openness and Firm Ownership

Zhenkuo Ding (), Man Hu () and Sheng Huang ()
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Zhenkuo Ding: Guangxi Normal University
Man Hu: Guangxi Normal University
Sheng Huang: Guangzhou University Town

Management International Review, 2023, vol. 63, issue 6, No 2, 941 pages

Abstract: Abstract Drawing on the international relations literature, the purpose of this paper is to investigate whether and when diplomatic relations between countries have an influence on firm internationalization speed. We discover that the friendlier bilateral diplomatic relations between home and host countries, the more beneficial it is to enhance firm internationalization speed. In addition, the higher trade openness of the host country, the smaller contribution of bilateral diplomatic relations for firm internationalization speed in the host country and friendly bilateral diplomatic relations have a stronger positive impact on internationalization speed when the internationalizing home enterprise is a state-owned enterprise (SOE). Our findings not only contribute to both the firm internationalization speed literature and the international relations literature, but also have managerial significance for how enterprises can use the friendly diplomatic relations between countries to improve firm internationalization speed.

Keywords: Diplomatic relations; Trade openness; Nature of firm ownership; Internationalization speed; International relations (search for similar items in EconPapers)
JEL-codes: F23 F55 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (4)

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DOI: 10.1007/s11575-023-00514-4

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