IE Papers 2016

Journal of Business Venturing – 2016, Volume 31, Issue, 3, 253-271

Escalation of commitment in venture capital decision making: Differentiating between domestic and international investors

David Devigne, Sophie Manigart and Mike Wright

  • Drawing upon an escalation of commitment framework, this study investigates how differences between cross-border and domestic venture capital investors in emotional, social, and institutional factors affect their decision to terminate an unsuccessful investment. We track the exit outcome of 1060 venture capital investments in 684 European technology companies. Results show that domestic investors have a high tendency to escalate their commitment to a failing course of action, while cross-border investors terminate their investments efficiently, even when investing through a local branch. This is explained by cross-border investors having a lower social and emotional involvement with the project and a lower embeddedness in the local economic and social environment, decreasing individual decision biases. Further, they are affected to a lower extent by normative pressures to further invest from their co-investment network. Local branches of cross-border investors are also shielded from escalation of commitment. We conjecture that their international investment committee acts as an organizational safeguard against individual decision biases. Domestic investors may hence benefit from mimicking the behavior of cross-border investors.


Journal of International Business Studies – 2016, Volume 47, Number 3, 295-318

International knowledge brokerage and returnees’ entrepreneurial decisions

Daomi Lin, Jiangyong Lu, Xiaohui Liu and Xiru Zhang

  • Based on the knowledge brokerage literature and the international entrepreneurship literature, we investigate whether returnees’ international knowledge transfer affects their entrepreneurial decisions and the extent to which this relationship is contingent on perceived supportive policies for returnee entrepreneurship and returnees’ difficulties with cross-cultural readjustment in their home countries. Analyzing first-hand survey data, we find a positive relationship between international knowledge transfer and returnees’ decisions to become entrepreneurs. This positive relationship is strengthened by the perception of the home country’s supportive policies for returnee entrepreneurship but is weakened by returnees’ perceived difficulties in readjusting to the local norms and culture in their home countries.


Journal of Small Business Management – 2016, Volume 54, Number 2, 445–461

The impact of social networks on perceptions of international opportunities

Witold Nowinski and Alex Rialp

  • The paper emphasizes the importance of social networks in the gestation of international new ventures, particularly through their impact on the perceptions of nascent entrepreneurs. Their contribution consists not only in providing new information to assist new venture founders in identifying international opportunities but, and perhaps more importantly, in assessing them. By modifying the way in which entrepreneurs perceive the feasibility and desirability of opportunities, networks trigger the enactment of international opportunities. Whereas opportunity evaluations by more experienced international entrepreneurs tend to be linked to their strong network ties, the international role models of novice entrepreneurs seem to be transformational.


Journal of Small Business Management – 2016, Volume 54, Number 2, 462–480

Entrepreneurial orientation and international performance: The moderating effect of decision-making rationality

Ioanna Deligianni, Pavlos Dimitratos, Andreas Petrou and Yair Aharoni

  • This research examines how entrepreneurial orientation (EO) influences international performance (IP) of the firm taking into account the moderating effect of decision-making rationality (DR) on the EO-IP association. Such an investigation is significant because it considers the interplay of strategic decision-making processes supported by the bounded rationality concept in the entrepreneurship field. Drawing from a study on activities of 216 firms in the United States and United Kingdom, the evidence suggests that DR positively moderates the EO-IP association. The findings suggest that managers can improve IP by combining EO with rational (analytical) processes in their strategic decisions.


Journal of Small Business Management – 2016, Volume 54, Number 2, 679–696

What does really matter in the internationalization of small and medium-sized family businesses?

Andrea Calabro, Marina Brogi and Mariateresa Torchia

  • Internationalization of family businesses is often considered a way to revitalize both the family and the business. However, the debate on its challenges and constraints is still inconclusive. This study explores whether incoming generations’ involvement impacts the decision to exploit and explore international opportunities and to what extent altruism and competence-based trust mediate that relationship. Three propositions are formulated drawing from international entrepreneurship literature and stewardship theory. To validate this framework, a multiple case study on four Italian family firms has been conducted. Implications for theory and practice are finally discussed.


Journal of World Business – 2016, Volume 51, Number 1, 93-102

Internationalization: From incremental to born global

Gary Knight and Peter W Liesch

  • In this paper, we summarize how internationalization research has evolved over time, where it stands today, and how it might evolve going forward. Specifically, we examine internationalization research from earlier times to the present day. We contrast the incremental internationalization characteristic of older multinational enterprises with the early, rapid internationalization of born global firms. The paper summarizes the evolution of research on early internationalization and born global firms, and provides evidence to suggest why this area now has attained legitimacy in scholarly research. We then examine important theoretical issues in born global research and suggest avenues for future research.