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|Title:||Explaining the effect of rapid internationalization on horizontal foreign divestment in the retail sector. An extended penrosean perspective|
|Keywords:||Foreign divestment;Penrose effect;Internationalization speed;Regional strategy theory;International experience;Retailers|
|Publisher:||European International Business Academy|
|Citation:||Proceedings of European International Business Academy (EIBA), Vienna, pp. 1-37, (2016)|
|Abstract:||Building on and extending Penrosean logic we argue that rapid international expansion by firms might lead to a breach of Penrosean constraints on efficient expansion and to subsequent divestment of international operations to bring firm scope back into Penrosean constraints. We further predict that intra-regional concentration and international experience moderate the above effect because they influence firms ability to avoid a breach of Penrosean constraints and/or weaken the consequences of such a breach. Using data on the international expansion and divestment of large retail MNEs over the period 2003-2012 we find empirical support for the proposed extended Penrose effect in explaining international divestment as well as for the moderating effects of intra-regional concentration and international experience. Our study contributes to the development of Penrosean logic and to our understanding of the factors that drive firms to divest overseas operations.|
|Appears in Collections:||Brunel Business School Research Papers|
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