International diversification : an exploration-exploitation perspective

Luger, Johannes (University of St Gallen, Switzerland) ; Schmitt, Achim (Ecole hôtelière de Lausanne, HES-SO // University of Applied Sciences Western Switzerland)

We take an exploration-exploitation perspective on international diversification. Specifically, we suggest that, since changes in international diversification are typically related to exploration or exploitation-related motives (e.g., exploring new knowledge or exploiting existing knowledge) and since both motives show self-reinforcing effects, international diversification increasingly unbalances firms’ exploration-exploitation orientation. This is unfortunate given that a balance among the two is associated with superior performance and, as we argue, these performance effects are even stronger the higher the degree of international diversification. Put together, we introduce a novel paradox: While international diversification benefits from intermediate levels of exploration and exploitation, it increasingly unbalances firms’ orientation among the two. We find support for our arguments in a global sample of insurance firms over a period of nine years (1999-2007).


Conference Type:
full paper
Faculty:
Economie et Services
School:
EHL
Subject(s):
Economie/gestion
Publisher:
Houston, USA, 28-31 October 2017
Date:
Houston, USA
28-31 October 2017
2017
Pagination:
7 p.
Published in
Proceedings of the SMS 37th annual conference
Appears in Collection:

Note: The status of this file is: restricted


 Record created 2018-03-05, last modified 2018-12-20

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