Why do western SMEs internationalize through springboarding? Evidence from French manufacturing SMEs

Noémie Dominguez

UNCTAD Transnational Corporations Journal

Abstract: This study applies both the internationalization and regulatory focus theories to understand what motivates SMEs to implement springboard strategies – i.e. to invest in a country to re-export to third countries. While some academics emphasize the importance of free trade agreements and cost differentials, others highlight the role played by the individual and network dimensions. We conducted 66 in-depth interviews and five days of non-participant observations with five French manufacturing SMEs and ten investment promotion agencies. Our analysis revealed the existence of firm, network and country-related motivations – springboard strategies being mainly firm-driven – as well as common, partially-shared and specific motivations. Public policy to promote and/or attract springboard-oriented foreign direct investment (FDI) should look at developing dedicated support and educational programmes for SMEs, offering better access to promising markets by removing barriers and enforcing transparency and trade agreements.

Date: 2020-04-01
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Persistent link: https://EconPapers.repec.org/RePEc:unc:tncjou:38

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