Location of Repository

Internationalization and competition in small manufacturing firms

By Timo Mikael Lautanen

Abstract

This study focuses on three topics in the behaviour of small manufacturing firms using theories from industrial economics as theoretical benchmarks. The study takes as its starting point the perspective of the individual enterprise rather than that of an industry or a market. For the study a considerable amount of new data was collected by interviewing about 80 small business managers in Finland up to three times by the end of 1997. The first of the three parts of the study considers the adoption of an export strategy. The non-linear econometric model adopted suggests that the adoption of an export strategy in small firms is in particularly influenced by the language skills of entrepreneurs, and has become faster over time. The second chapter provides insights into the differentiation behaviour of industrial small firms. At the individual firm's level, vertical differentiation seems to have a special weight since horizontal differentiation is often limited by the requirement of technical compatibility, and because improving quality is perceived to incorporate lower risk than differentiation based on taste differences between customers.\ud \ud The third chapter studies exiting from export markets using the case-study method of research. There is no strong case for, or against, the export hysteresis in the data, and thus one can argue that the behaviour of the firms has been largely in accordance with the standard theory of a competitive industry. The lack of an explicitly export strategy and concentration on exports to one country seem to contribute to exit where the nature of exporting can be described as opportunistic. Overall, the firm-level study presented here suggests the relevance of further studies using models of diffusion of innovations to theorize small business exporting and to taking better into consideration of an individual firm's perspective in studies on product differentiation. Moreover, demand side influences on export hysteresis should be studied further

Topics: HD
OAI identifier: oai:wrap.warwick.ac.uk:2905

Suggested articles

Preview

Citations

  1. (1985). 0 99 1) Sunk Costs and Market Structure -MIT Press.
  2. 1) "Econornics and Business ".
  3. (1994). 7,
  4. (1993). A and A Waterson
  5. (1994). A Matched Pairs Comparison of 'Exporting'and 'Nonexporting'Small Finns in Great Britain. Warwick Business School, The Centre for Small and Medium-Sized Enterprises, Working Paper No.
  6. (1994). A Note on Methodology". (mimeo, The University of
  7. (1996). Advantage Finland: The Future of Finnish Industries.
  8. (1996). Ahopelto (eds. ) Verkostoajattelusta verkostotoimintaan. Yrityksen talousticteen laitos, Kuopion yliopisto,
  9. (1995). Automobile Prices in Market Equilibrium". doi
  10. (1989). Building Theories from Case Study Research". doi
  11. (1987). Business Strategy and the Internationalization of Businesses: Recent Approaches". doi
  12. (1994). Case Study Research: Design and Methods. Second edition.
  13. (1998). Central Government Debt". doi
  14. (1980). Competitive Strategy: Techniques for Analyzing Industries and Competitors.
  15. (1980). Conceptualizing the Intemationalization Process of Medium-sized Firms. Some Preliminary Considerations for a Research Design".
  16. (1982). Contestable Markets: An Uprising in the Theory of Industry Structure". The American Economic Review,
  17. (1984). Convenient Specification Tests for Logit and Probit Models", doi
  18. (1993). Corporate Strategies and European Challenges Post-1992", doi
  19. (1984). Differences Among Exporting Firms Based on their Degree of Intemationalization". doi
  20. (1990). EEC Integration Towards 1992: Some Distributional Aspects". doi
  21. (1998). Entrepreneur and Small Firms's Intemationalisation - Does the Past Matter?
  22. (1982). Entrepreneurship and the New Fi. nn. Croom Helm,
  23. (1989). Entry and Exit Decisions under Uncertainty". doi
  24. (1992). European Economic Integration and the Nordic Countries Trade. doi
  25. (1980). Exit Barriers are Entry Barriers: The Durability of Capital as a Barrier to Entry". doi
  26. (1995). Experimentation and Learning in a Differentiated-Products Duopoly". doi
  27. (1982). Export Strategy: Markets and Competition. doi
  28. (1983). Firm Internationalization, Transaction Costs and Strategic Choice". doi
  29. (1990). Firms in Network: Concepts, Spatial Impacts and Policy Implications".
  30. (1994). Foreign Investment in Contemporary Russia: Managing Capital Entry. doi
  31. (1993). Foundations of Corporate Success. Oxford university Press. 260 Kaj aste, 1. (199 1) "Yhdentyminen ja kansantalouden herkdt alat".
  32. (1996). Horizontal and Vertical Differentiation: The Launhardt Model". doi
  33. (1988). Hysteresis in Export Prices: The Beachhead Effect". The American Economic Review, doi
  34. (1989). Hysteresis, Import Penetration, and Exchange Rate Passthrough". doi
  35. (1993). Identifying Asymmetric Competitor Networks from Characteristics Data: Application to the Spreadsheet Software Market". doi
  36. (1990). Identifying the Strategic Market". Business Strategy Review, doi
  37. (1996). Industrial Competitiveness: A Firm-level View",
  38. (1979). Industrial Economics. doi
  39. (1984). Information Acquisition and Export Entry Decisions in Small Firms". doi
  40. (1986). Information Provision vs. doi
  41. (1980). Initial Exports -A marketing Failure? ". doi
  42. (1994). Integration and Export Behaviour of Firms: Trade Costs, Trade Volumes and Welfare". doi
  43. (1990). Integration and the Competitiveness of Peripheral Industry".
  44. (1993). Ita-Suomen talouden idansuhteet". Paper presented at the Russian-Finnish joint research seminar "Karjalat katsovat toisiaan",
  45. (1993). Location and Internationalization of Small Firms", doi
  46. (1989). Management Influences on Export Performance: A Review of the Empirical Literature 1978-88". doi
  47. (1988). Measuring Product Prices Under Conditions of Quality Change: The Case of Passenger Cars in Greece". doi
  48. (1993). Measuring the Importance of Sunk Costs". Annales D'Economie et de Statistique,
  49. (1994). Models of Product Differentiation".
  50. (1994). Modem Industrial Organization (second edition). Harper Collins,
  51. (1984). Natural Oligopolies and International Trade". doi
  52. (1994). Nordic Small and Medium-sized Enterprises in Changing Competitive Conditions. Licentiate thesis,
  53. (1993). of Trade and Industry doi
  54. (1995). Oligopolistic Competition and the Optimal Provision of Products". doi
  55. (1984). Oligopolistic Competition, Product Variety, and International Trade". doi
  56. (1980). On the Internationalization Process of Firms".
  57. (1989). Persistent Trade Effects of Large Exchange Rate Shocks". doi
  58. (1988). Product and Price Competition in a Duopoly". doi
  59. (1987). Product Differentiation and Industrial Structure ". doi
  60. (1995). Product Differentiation and Oligopoly in International Markets: The Case of the U. doi
  61. (1993). Product Differentiation as a Source of Comparative Advantage? "
  62. (1982). Product Proliferation in Characteristic Space: The UK Fertilizer industry".
  63. (1984). Protection and product Differentiation".
  64. (1993). Rank, Stock, Order, and Epidemic Effects in the Diffusion of New Process Technologies: An Empirical Model". doi
  65. (1982). Relaxing Price doi
  66. (1992). research Institute of the Finnish Economy
  67. (1994). Selvilys suorista sijoituksista Suomeen. Suomen pankki, 258 keskustelunaloitteita 2/94, Helsinki. (Bank of Finland, Discussion Papers;
  68. (1994). Sma -retagens internationalisering - en nordiskjämförande studie.
  69. (1988). Small Businesses and Exporting: A Literature Review". doi
  70. (1998). SMEE SuPPOrt Policy in Finland: An Evaluation of SMIE Policy Programs and Instruments.
  71. (1929). Stability in Competition". The Eýonomic Joumal,
  72. (1984). Statistical Yearbook of Finland doi
  73. (1992). Strategic Product Choice and Niche Markets". doi
  74. (1989). Strategies of Firms and Structural Environments in the Large Internal Market". doi
  75. (1992). Sunk Costs and Trade Liberalization". doi
  76. (1995). Suomen idankauppa 1985-94". Review of Economies in Transition, 3/1995. Bank of Finland, Unit for Eastern European Economies,
  77. (1992). Suomi Euroopan Yhteisdnjdseneksi? Taloudelliset vaikutukset.
  78. (1997). The Case Study Method for Research in Small- and Mediumsized Firms".
  79. (1997). The Decision to Export in Columbia: An Empirical Model of Entry with Sunk Costs". The American Economic Review, doi
  80. (1986). The Demand for Information and the Diffusion of a New Product". doi
  81. (1989). The Diffusion of Industrial Robots in Japan and the United States", doi
  82. (1979). The Diffusion of Process Innovations. doi
  83. (1993). The Dynamics of Competitive Industries: Theory, Evidence, and policy Implications"
  84. (1983). The Economic Analysis of Technological Change. doi
  85. (1987). The Economic Analysis of Technology Policy. doi
  86. (1988). The Economics of 1992. An Assessment of the Potential Economic Effects of Completing the Internal Market of the European Com- 256 munity.
  87. (1997). The Economics of Industrial Innovation (Third edition).
  88. (1986). The Economics of Intra-Industry Trade. doi
  89. (1988). The European Challenge 1992, The Benefits of a Single Market (The Cecchini Report).
  90. (1977). The Export Behaviour of Smaller-Sized Wisconsin Manufacturing Firms". doi
  91. (1968). The First Export Order: a Marketing Innovation". doi
  92. (1982). The Impact of Size on Export Behaviour in Small Firms".
  93. (1994). The Internationalization of SMEs in Four Finnish Regions: Some Tentative Observations. In
  94. (1984). The Measurement of Produce Differentiation in Empirical Studies of International Trade Flows".
  95. (1990). The Mechanism of Internationalization". doi
  96. (1992). The Relationship Between Models of Horizontal and Vertical Differentiation". doi
  97. (1988). The Theory of Industrial Organization. doi
  98. (1979). Thisse doi
  99. (1993). Three Assessments of Finland's Economic Crisis and Economic Policy.
  100. (1985). Two stage (Perfect) Equilibrium in Hotelling's Model". doi
  101. (1998). Unemployment. " [http: //www.
  102. (1987). Valtion taloudellinen tutkimuskeskus, julkaisuja 5. Helsinki. (In Finnish) Venables,
  103. (1979). Variety, Equity, and Efficiency. doi
  104. (1986). Vertical Differentiation: Some Basic Themes".
  105. (1994). Yhteisty6ssdk6 viennin avaimet? Havaintoja pohjoismaisten pkt-yritysten kansainvMistyrnisestd",

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.