Skip to main content
SpringerLink
Log in

Toward a Knowledge-Based Conceptualization of Internationalization

  • Published:
Journal of International Entrepreneurship Aims and scope Submit manuscript

Abstract

This conceptual paper contributes to the internationalization literature in response to previous criticisms by enabling the integration of apparently contradictory strands of the literature and incorporation of the potential role of the Internet. Knowledge is at the core of received wisdom on internationalization. This is consistent with the notion that internationalization represents an innovation of the firm and often entails decision-making under conditions of uncertainty, for both of which knowledge is vital. Given the link between knowledge and internationalization, apparent tensions in the literature can be resolved by recognizing its different types, consequently varying roles and diverse sources. Furthermore, network relationships—of growing significance in the literature—yield social capital, which in turn leads to knowledge acquisition and creation; thus it is worthwhile to integrate knowledge and social capital perspectives. Finally, consistent with the knowledge-based approach adopted in the paper, the application of Internet technology is conceptualized in terms of information effects viz., information dissemination, acquisition and sharing which could lead to, respectively, enhanced internationalization, knowledge and social capital.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Adler, P.S. and S.-W. Kwon, 2002, ‘Social Capital: Prospects for a New Concept’, Academy of Management Journal 27 (1), 17–40.

    Google Scholar 

  • Andersen, O. 1993, ‘On the Internationalisation Process of Firms: A Critical Analysis’, Journal of International Business Studies 24(2), 209–231.

    Google Scholar 

  • Arenius, P.M., 2002, Creation of Firm-Level Social Capital, its Exploitation, and the Process of Early Internationalization, Unpublished Doctoral Dissertation, Helsinki: Helsinki University of Technology.

  • Autio, E., H.J. Sapienza, and J.G. Almeida, 2000, ‘Effects of Age at Entry, Knowledge Intensity, and Imitability on International Growth’, Academy of Management Journal 43(5), 909–924.

    Google Scholar 

  • Barkema, H.G. and F. Vermeulen, 1998, ‘International Expansion through Start-Up or Acquisition: A Learning Perspective’, Academy of Management Journal 41(1), 7–26.

    Google Scholar 

  • Barney, J.B. 1991, ‘Firm Resources and Sustained Competitive Advantage’, Journal of Management 17, 155–171.

    Google Scholar 

  • Berry, M.M.J. and J.K-U. Brock, 2004, ‘Marketspace and the Internationalisation Process of the Small Firm’, Journal of International Entrepreneurship 2(3), 187–216.

    Google Scholar 

  • Blomstermo, A., K. Eriksson, and D.D. Sharma, 2004, ‘Domestic Activity and Knowledge Development in the Internationalization Process of Firms’, Journal of International Entrepreneurship 2(3), 239–258.

    Google Scholar 

  • Bilkey, W.J. and G. Tesar, 1977, ‘The Export Behaviour of Smaller Sized Wisconsin Manufacturing Firms’, Journal of International Business Studies 8(1), 93–98.

    Google Scholar 

  • Burt, R.S. 1992, Structural Holes, Cambridge: Harvard University Press.

  • Calof, J.L. and P.W. Beamish, 1995, ‘Adapting to Foreign Markets: Explaining Internationalization’, International Business Review 4(2), 115–131.

    Google Scholar 

  • Cohen, W. and D. Levinthal, 1990, ‘Absorptive Capacity: A New Perspective on Learning and Innovation’, Administrative Science Quarterly 35, 128–152.

    Google Scholar 

  • Coleman, J.S., 1988, ‘Social Capital in the Creation of Human Capital’, American Journal of Sociology 94, S95–S120.

    Google Scholar 

  • Coviello, N.E. and M.V. Jones, 2004, ‘Methodological Issues in International Entrepreneurship Research’, Journal of Business Venturing 19(4), 485–508.

    Google Scholar 

  • Davenport, T.H., J.G. Harris, and A.K. Kohli, 2001, ‘how do they know their customers so well?’, mit sloan management review winter, 63–73.

  • Demsetz, H., 1991, ‘The Theory of the Firm Revisited’, in Williamson and Winter (eds.), The Nature of the Firm, New York: Oxford University Press, pp. 159–178.

    Google Scholar 

  • Eisenhardt, K.M. and J.A. Martin, 2000, ‘Dynamic Capabilities: What are They?’, Strategic Management Journal 21, 1105–1121.

    Google Scholar 

  • Eriksson, K. and S. Chetty, 2003, ‘The Effect of Experience and Absorptive Capacity on Foreign Market Knowledge’, International Business Review 12(6), 673–695.

    Google Scholar 

  • Eriksson, K., J. Johanson, A. Majkgård, and D. Sharma, 1997, ‘Experiential Knowledge and Cost in the Internationalization Process’, Journal of International Business Studies 28(2), 337–360.

    Google Scholar 

  • Evans, P.B. and T.S. Wurster, 1997, ‘Strategy and the New Economics of Information’, Harvard Business Review 75(5), 70–82.

    Google Scholar 

  • Fiol, C.K. and M.A. Lyles, 1985, ‘Organizational Learning’, Academy of Management Review 10(4), 803–813.

    Google Scholar 

  • Grant, R.M. 1996, ‘Prospering in Dynamically-Competitive Environments: Organizational Capability as Knowledge Integration’, Organization Science 7, 375–387.

    Google Scholar 

  • Grant, R.M. 2002, ‘The Knowledge-Based View of the Firm’, in C.W. Choo and N. Bontis (eds.), The Strategic Management of Intellectual Capital and Organizational Knowledge Oxford: Oxford University Press, pp. 133–148.

    Google Scholar 

  • Gulati, R. 1999, ‘Network Location and Learning: The Influence of Network Resources and Firm Capabilities on Alliance Formation’, Strategic Management Journal 20, 397–420.

    Google Scholar 

  • Hoffman, D.L. and T.P. Novak, 2000, ‘How to Acquire Customers on the Web’, Harvard Business Review 78 (3), 179–188.

    Google Scholar 

  • Hoffman, D.L. and T.P. Novak, 1996, ‘Marketing in Hypermedia Computer-Mediated Environments: Conceptual Foundations’, Journal of Marketing 60(3), 50–68.

    Google Scholar 

  • Holm, D.B., K. Eriksson, and J. Johanson, 1996, ‘Business Networks and Cooperation in International Business Relationships’, Journal of International Business Studies 27(5), 1033–1053.

    Google Scholar 

  • Hult, G.T.M and D.J. Ketchen, 2001, ‘Does Market Orientation Matter?: A Test of the Relationship between Positional Advantage and Performance’, Strategic Management Journal 22(9), 899–906.

    Google Scholar 

  • Johanson, J. and L.-G. Mattsson, 1988, ‘Internationalization in Industrial Systems—a Network Approach’, in N. Hood and J.-E. Vahlne (eds.), Strategies in Global Competition, London: Croon Helm, pp. 287–314.

    Google Scholar 

  • Johanson, J. and J.-E. Vahlne, 1977, ‘The Internationalization Process of the Firm—a Model of Knowledge Development and Increasing Foreign Market Commitment’, Journal of International Business Studies 8(1), 23–32.

    Google Scholar 

  • Johanson, J. and J.-E. Vahlne, 2003, ‘Business Relationship Learning and Commitment in the Internationalization Process’, Journal of International Entrepreneurship 1(1), 83–102.

    Google Scholar 

  • Johanson, J. and F. Wiedersheim-Paul, 1975, ‘The Internationalization of the Firm—Four Swedish Cases’, Journal of Management Studies 12, 305–322.

    Google Scholar 

  • M.V. Jones, 2003, Doctoral Thesis Review: Creation of Firm-Level Social Capital, its Exploitation, and the Process of Early Internationalization Pia Maria Arenius. Helsinki University of Technology Institute of Strategy and International Business, Doctoral Dissertations 2002/3, Helsinki, ISBN 951-22-6114-6’, Journal of International Entrepreneurship 1 (4), 415–417.

  • Jones, M.V. and N.E. Coviello, 2005, ‘Internationalization: Conceptualizing an Entrepreneurial Process of Behavior in Time’, Journal of International Business Studies 36(3), forthcoming.

  • Kaplan, S. and M. Sawney, 2000, ‘E-Hubs: The New B2B Marketplaces’, Harvard Business Review 78(3), 97–103.

    Google Scholar 

  • Knight, G.A. and S.T. Cavusgil, 1996, ‘The Born Global Firm: A Challenge to Traditional Internationalisation Theory’, Advances in International Marketing 8, 11–26.

    Google Scholar 

  • Knight, G.A. and S.T. Cavusgil, 2004, ‘Innovation, Organizational Capabilities, and the Born-Global Firm’, Journal of International Business Studies 35(2), 124–141.

    Google Scholar 

  • Kobrin, S.J., 2001, ‘Territoriality and the Governance of Cyberspace’, Journal of International Business Studies 32(4), 687–704.

    Google Scholar 

  • Kogut, B. and U. Zander, 1993, ‘Knowledge of the Firm and the Evolutionary Theory of the Multinational Corporation’, Journal of International Business Studies 24(4), 625–645.

    Google Scholar 

  • Kohli, A.K. and B.J. Jaworski, 1990, ‘Market Orientation: the Construct, Research Propositions, and Managerial Implications’, Journal of Marketing 54, 1–18.

    Google Scholar 

  • Kohli, A.K., B.J. Jaworski, and A. Kumar, 1993, ‘Markor: A Measure of Market Orientation’, Journal of Marketing Research 30, 467–477.

    Google Scholar 

  • Koka, B.R. and J.E. Prescott, 2002, ‘Strategic Alliances and Social Capital: A Multidimensional View’, Strategic Management Journal 23(9), 795–816.

    Google Scholar 

  • Kostova, T. and K. Roth, 2003, ‘Social Capital in Multinational Corporations and a Micro-Macro Model of its Formation’, Academy of Management Review 28(2), 297–317.

    Google Scholar 

  • Kotha, S., V.P. Rindova, and F.T. Rothaermel, 2001, ‘Assets and Actions: Firm-Specific Factors in the Internationalization of US Internet Firms’, Journal of International Business Studies 32(4), 769–791.

    Google Scholar 

  • Leamer, E.E. and M. Storper, 2001, ‘The Economic Geography of the Internet Age’, Journal of International Business Studies 32(4), 641–665.

    Google Scholar 

  • Lee, C., K. Lee, and J.M. Pennings, 2001, ‘Internal Capabilities, External Networks, and Performance: A Study on Technology-Based Ventures’, Strategic Management Journal 22(6/7), 615–640.

    Google Scholar 

  • Liebeskind, J.P. 1996, ‘Knowledge, Strategy, and the Theory of the Firm’, Strategic Management Journal 17(Winter Special Issue), 93–107.

    Google Scholar 

  • Liesch, P.W. and G.A. Knight, 1999, ‘Information Internalization and Hurdle Rates in Small and Medium Enterprise Internationalization’, Journal of International Business Studies 30(2), 383–394.

    Google Scholar 

  • Lorenzoni, G. and A. Lipparini, 1999, ‘The Leveraging of Interfirm Relationships as a Distinctive Capability: A Longitudinal Study’, Strategic Management Journal 20(4), 317–338.

    Google Scholar 

  • Lu, J.W. and P.W. Beamish, 2001, ‘The Internationalization and Performance of Smes’, Strategic Management Journal 22, 565–586.

    Google Scholar 

  • Luostarinen, R. 1980, Internationalization of the Firm, Helsinki School of Economics.

  • Manolova, T.S. and I.M. Manev, 2004, ‘Internationalization and the Performance of the Small Firm: A Review of the Empirical Literature between 1996 and 2001’, in M.V. Jones and P. Dimitratos (eds.), Emerging Paradigms in International Entrepreneurship, Northampton, MA: Edward Elgar, pp. 37–63.

  • Mcdougall, P.P. and B.M. Oviatt, 2000, ‘International Entrepreneurship: The Intersection of two Research Paths’, Academy of Management Journal 43(5), 902–906.

    Google Scholar 

  • Mcdougall, P.P. and B.M. Oviatt, 2003, ‘Some Fundamental Issues In international Entrepreneurship’, United States Association for Small Business and Entrepreneurship White Paper(available: http://www.usasbe.org/knowledge/whitepapers/mcdougall2003.pdf)

  • Mcdougall, P.P., S. Shane, and B.M. Oviatt, 1994, ‘Explaining the Formation of International New Ventures: The Limits of Theories from International Business Research’, Journal of Business Venturing 9, 469–487.

    Google Scholar 

  • Melin, L. 1992, ‘Internationalization as a Strategy Process’, Strategic Management Journal 13, 99–118.

    Google Scholar 

  • Nahapiet, J. and S. Ghoshal, 1998, ‘Social Capital, Intellectual Capital, and the Organizational Advantage’, The Academy of Management Review 23(2), 242–266.

    Google Scholar 

  • Nelson, R. and S. Winter, 1982, An Evolutionary Theory of Economic Change, Cambridge, MA: Belknap Press.

  • Oviatt, B.M. and P.P. Mcdougall, 1994, ‘Toward a Theory of New International Ventures’, Journal of International Business Studies, 25(1)45–64

    Google Scholar 

  • Oviatt, B.M. and P.P. Mcdougall, 2005, ‘The Internationalization of Entrepreneurship’, Journal of International Business Studies 35(6), in press.

  • Parasuraman, A. and G.M. Zinkhan, 2002, ‘Marketing to and Serving Customers through the Internet: An Overview and Research Agenda’, Journal of the Academy of Marketing Science 30(4), 286–295.

    Google Scholar 

  • Penrose, E. 1959, The Theory of the Growth of the Firm, New York: Wiley.

    Google Scholar 

  • Porter, M.E. 2001, ‘Strategy and the Internet’, Harvard Business Review 79(3), 62–78.

    Google Scholar 

  • Prahalad, C.K. and G. Hamel, 1990, ‘The Core Competence of the Corporation’, Harvard Business Review 68(3), 79–91.

    Google Scholar 

  • Prashantham, S. and M.M.J. Berry, 2004, ‘The Small Knowledge-Intensive Firm: A Conceptual Discussion of its Characteristics and Internationalisation’, International Journal of Entrepreneurship and Innovation Management 4(2), 150–158.

    Google Scholar 

  • Prashantham, S. and S. Young, 2004, ‘The Internet and The Internationalization of Small Knowledge-Intensive Firms: Promises, Problems and Prospects’, International Journal of Entrepreneurship and Small Business 1(1/2), 153–175.

    Google Scholar 

  • Quelch, J.A. and L.R. Klein, 1996, ‘The Internet and International Marketing’, Sloan Management Review spring, 60–75.

  • Reuber, A.R. and E. Fischer, 1997, ‘The Influence of the Management Team’s International Experience on the Internationalization Behaviors of Smes’, Journal of International Business Studies 28(4), 807–825.

    Google Scholar 

  • Sampler, J.L. 1998, ‘Redefining Industry Structure for the Information Age’, Strategic Management Journal 19(4), 343–355.

    Google Scholar 

  • Sapienza, H.J., E. Autio, and S. Zahra, 2003, ‘Effects of Internationalization on Young Firms’ Prospects for Survival and Growth’, in Academy of Management Best Paper Proceedings.

  • Sawhney, M., E. Prandelli, and G. Verona, 2003, ‘The Power of Infomediation’, Mit Sloan Management Review 44(2), 77–82.

    Google Scholar 

  • Sawhney, M. and J. Zabin, 2002, ‘Managing and Measuring Relational Equity in the Network Economy’, Journal of Academy of Marketing Science 30(4), 313–332.

    Google Scholar 

  • Simmonds, K. and H. Smith, 1968, ‘The First Export Order: A Marketing Innovation’, British Journal of Marketing 2(2), 93–100.

    Google Scholar 

  • Singh, N. and S. Kundu, 2002, ‘Explaining the Growth of E-Commerce Corporations (ECCS): An Extension and Application of the Eclectic Paradigm’, Journal of International Business Studies 33(4), 679–697.

    Google Scholar 

  • Spender, J.-C. 1994, ‘Organizational Knowledge, Collective Practice and Penrose Rents’, International Business Review 3(4), 353–367.

    Google Scholar 

  • Tallman, S. and K. Fladmoe-Lindquist, 2002, ‘Internationalization, Globalization, and Capability-Based Strategy’, California Management Review 45(1), 116–135.

    Google Scholar 

  • Teece, D.J., G. Pisano, and A. Shuen, 1997, ‘Dynamic Capabilities and Strategic Management’, Strategic Management Journal, 18(7),509–533

    Google Scholar 

  • Tsai, W. and G. Ghoshal, 1998, ‘Social Capital and Value Creation: The Role of Intrafirm Networks’, Academy of Management Journal 41(4), 464–476.

    Google Scholar 

  • Von Krogh, G. 2003, ‘Open-Source Software Development’, Mit Sloan Management Review 44(3), 14–18.

    Google Scholar 

  • Walczuch, R.M., G. Van Braven, and H. Lundgren, 2000, ‘Internet Adoption Barriers for Small Firms in the Netherlands’, European Management Journal 18(5), 561–572.

    Google Scholar 

  • Wiedersheim-Paul, F., H.C. Olson, and L. Welch, 1978, ‘Pre-Export Activity: The First Step in Internationalization’, Journal of International Business Studies 9(1), 93–98.

    Google Scholar 

  • Yli-Renko, H., E. Autio, and H.J. Sapienza, 2001, ‘Social Capital, Knowledge Acquisition, and Knowledge Exploitation in Young Technology-Based Firms’, Strategic Management Journal 22, 587–613.

    Google Scholar 

  • Yli-Renko, H., E. Autio, and V. Tontti, 2002, ‘Social Capital, Knowledge and the International Growth of Technology-Based New Firms’, International Business Review 11, 279–304.

    Google Scholar 

  • Young, S., J., Hamill, C. Wheeler, and J.R. Davies, 1989, International Market Entry and Development, Hemel Hempstead: Harvester Wheatsheaf.

  • Zahra, S.A., R.D. Ireland, and M.A. Hitt, 2000, ‘International Expansion by New Venture Firms: International Diversity, Mode of Market Entry, Technological Learning, and Performance’, Academy of Management Journal 43(5), 925–950.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. AIM Research Fellow, Graduate School of Business, University of Strathclyde, 199 Cathedral Street, Glasgow, G4 0QU, United Kingdom

    Shameen Prashantham

Authors
  1. Shameen Prashantham
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Shameen Prashantham.

Additional information

An earlier version of this paper was presented at the 2004 Academy of International Business Conference in Stockholm and the 2003 European Academy of International Business Conference in Copenhagen; the author thanks the respective discussants, Professors Jongmoo Jay Choi and Jan-Erik Vahlne, for their encouraging and helpful comments

Rights and permissions

Reprints and permissions

About this article

Cite this article

Prashantham, S. Toward a Knowledge-Based Conceptualization of Internationalization. J Int Entrepr 3, 37–52 (2005). https://doi.org/10.1007/s10843-005-0304-5

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/s10843-005-0304-5

Keywords

Search

Navigation