Internationalization of Chinese firms : a contingent resource perspective

This study examines the role of inward activities in the internationalization of firms from China and proposes a theoretical framework of internationalization using the contingent resource theory. Based on case studies of four Chinese enterprises and a survey of Chinese manufacturing firms, the study shows that by engaging in inward activities, firms may acquire the critical resources that can lead to outward activities and the internationalization process. Whether firms can succeed in internationalization is conditional upon several contingency factors including management motivation, absorptive capacity, resource fungibility, exploration strategy, exploitation strategy and government support. Lastly, we explore the implications of the inward activities-based approach to internationalization, internationalization strategies for firms from developing economies, and the directions for future research