Paths and geographic scope of international expansion across industries

In this paper, we investigate how firms' international expansion paths and their geographic scope differ across industries, with longitudinal data from 1999 to 2008 for Fortune Global 500 firms. We first classify firms into three generic paths of international expansion based on the industry characteristics (i.e., institution-driven, capability-driven, and linkage-driven). We then investigate the differences in three generic international expansion paths and geographic scope with descriptive and growth curve analyses. The results show that firms operating in an institution-driven industry mostly expand their upstream activity internationally, but their geographic scope is limited. In contrast, those firms in a capability-driven industry mainly expand their downstream international activities, potentially beyond a regional geographic boundary. Firms in a linkage-driven industry likely coordinate both upstream and downstream activities internationally, but with larger geographic scope in downstream activities than upstream activities. Thus, firms across industries have taken distinctive paths of international expansion with substantially different geographic scope of operation.