Entrepreneurs’ Assessments of Early International Entry: The Role of Foreign Social Ties, Venture Absorptive Capacity, and Generalized Trust in Others

Abstract

Drawing on the literature on social ties, we develop a model toward entrepreneurs’ assessments of early international entry. We argue that social ties in foreign markets trigger entrepreneurs’ assessed attractiveness of exploiting potentially valuable opportunities contingent on their perceptions of the venture's absorptive capacity and their generalized trust in others. We test these hypotheses using a metric conjoint experiment, and data on 4,352 international entry assessments nested within 136 entrepreneurs. Our findings reveal significant cross–level interactions between the characteristics of entrepreneurs’ social ties, venture absorptive capacity, and entrepreneurs’ trust in others in explaining how they assess international entry.