A hybrid approach to international market selection: The case of impact investing organizations

Roy Mersland, Samuel Anokye Nyarko and Amila Buddhika Sirisena
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Roy Mersland: UIA - University of Agder

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Abstract: Social enterprises are hybrid organizations that concurrently pursue social and economic goals and hence are mid-way between conventional capitalistic firms and non-profit organizations. Many social enterprises are becoming international; delivering services across borders. With the objective of understanding the internationalization of these unconventional organizations, this paper examines their international market selection decision based on host countries' macroeconomic conditions. Generally, we hypothesize that the international market selection decision of social enterprises is tied to their hybridity, an overarching characteristic that sets them apart from other types of organizations. We build an original dataset with information on 41 European and North American impact investing organizations and 153 developing countries. Largely, our findings support the hypothesis, suggesting that social enterprises operate in foreign countries that offer a desirable balance between their social and financial goals. However, they avoid contexts with high country risk, factors that could cause a shortfall in expected returns.

Keywords: Cross-Border Investments; Internationalization; Social Enterprises; International Market Selection; Macroeconomic Factors; Hybrid Organizations F23; G21; L31; Cross-Border Investments Internationalization Social Enterprises International Market Selection Macroeconomic Factors Hybrid Organizations F23 G21 L31 (search for similar items in EconPapers)
Date: 2020
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Published in International Business Review, 2020, 29 (1), pp.101624. ⟨10.1016/j.ibusrev.2019.101624⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05221031

DOI: 10.1016/j.ibusrev.2019.101624

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