Interpersonal social networks and internationalization of traditional SMEs

Abstract

ABSTRACTThis study aims to understand the role of interpersonal social networks in the international strategies of “traditional SMEs,” namely small firms that are “born local” and that operate in low-tech and non-knowledge-intensive industries. Specifically, building on the social capital approach and the international entrepreneurship literature, this study investigates how the structure and the content of interpersonal social networks affect both the activities of exploration/exploitation of opportunities abroad, as well as the path and the performance of the internationalization processes in the pre-entry and post-entry phases. Results show the dynamics of internationalization as a “social embedded” endeavor, by highlighting heuristics and path-dependent phenomena connected to the features of the interpersonal social networks. Findings contribute to the literature as to the decision-making processes, the role of trust, and the possible negative effects generated by the structure and the content of the interpersonal social networks, including the market withdrawals.