Beggars Cannot be Choosers? How Experiential and Vicarious Learning Direct Problemistic Search at Firm Internationalization

Zhensen Yang () and Ying Zhou ()
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Zhensen Yang: Wuhan University
Ying Zhou: Wuhan University

Management International Review, 2023, vol. 63, issue 6, No 3, 943-978

Abstract: Abstract Scholars' opinions diverge on the relationship between a firm's negative attainment discrepancy and its international expansion. To reconcile the dispute, we draw upon the behavioral theory of the firm and develop an empirical framework that integrates the perspectives of problemistic search, experiential learning, and vicarious learning. We contend that a firm's search behavior is jointly influenced by its performance feedback and accumulated (both direct and indirect) experience. Specifically, the international experience of the focal firm or its peers plays an important role in triggering the firm's internationalization process by shaping the direction of problemistic search: a firm is more likely to pursue international expansion as a solution for performance shortfalls if it (or its peers) possesses more general experience or successful experience in foreign markets. Analysis on longitudinal data (2011–2019) from publicly listed Chinese firms supports our hypotheses. This study makes theoretical contribution on firm internationalization literature and the behavioral theory of the firm, and provides a practical insight into firms' strategic decision-making process.

Keywords: Behavioral theory of the firm; Problemistic search; Experiential learning; Vicarious learning; Performance feedback; Firm internationalization (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s11575-023-00515-3

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