Why Do EEFs Invest in other Emerging Markets? Examining the Role of Familiarity with the Emerging Market Context and Interpersonal Networks

(Meqbel Mishary Aliedan)

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Abstract

The current study responds to calls for bridging the research divide between the internationalization of emerging-market entrepreneurial firms (EEFs) and their familiarity with the emerging market context. Theoretically, the present study explains how familiarity with the emerging market context is powered by formal and informal interpersonal networks for reasons pertaining to the facilitation of the internationalization of EEFs. Data collected from 166 Saudi entrepreneurial firms indicates the significant impact of familiarity with the emerging market context in regard to the internationalization of EEFs, and this association is mediated by formal and informal interpersonal networks. The data also reveals the negative role of cultural distance in moderating the correlation between interpersonal networks and the internationalization of EEFs. A series of governmental and managerial implications are detailed in this study, as well as the identification of potential avenues for further research.

KEYWORDS
Formal and informal interpersonal networks, internationalization, cultural distance

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References

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