Unbundling the Effects of Internationalization on Firm Performance in Emerging Economies: The Moderating Effects of Strategic Resource Decisions

The authors investigate how strategic resource decisions-regarding slack resources and strategic marketing ambidexterity-influence the relationship between internationalization and firm performance of emerging-market firms. Drawing on the resource-based view, the authors synthesize two dominant, yet divergent, perspectives that explain the respective resource slack advantages and liabilities in the internationalization literature: the flexible capacity and the efficient capacity perspectives. They also explore the moderating role of strategic marketing ambidexterity, which comprises a bundle of marketing activities covering both exploitation-dominant actions and exploration-dominant actions. The authors empirically examine the hypothesized relationships with data from a sample of 1,683 firm-year observations for the period between 2005 and 2018 and find that distinct forms of resource slack have contrasting effects on the relationship between internationalization and performance. The results provide strong evidence for a positive moderation effect of unabsorbed slack resources and a negative moderation effect of absorbed slack resources on the internationalization-performance relationship. The authors also find a nonsignificant moderating effect of strategic marketing ambidexterity, demonstrating that internationalization results in higher firm performance regardless of the firm's exploration-dominant or exploitation-dominant strategic emphasis in emerging economies.