Liability of country foreignness and liability of regional foreignness: Their effects on geographic diversification and firm performance

摘要: The costs of inter- and intra-regional diversification have been widely discussed in the existing international business literature, but findings are mixed. Explanations for mixed important managerial implications, because managers to estimate accurately doing within across regions before they make their internationalization decisions. To explain findings, this study differentiates between liabilities foreignness at country regional levels, explores joint effects liability (LCF) (LRF) on performance internationalizing firms. Using data from 167 Canadian firms, we find that LCF may not necessarily be negatively correlated with diversification, LRF is positively inter-regional diversification. moderates relationship also mediates firm performance. Missing one or more these variables result different cost estimates. Identification relationships helps improve accuracy estimating aboard.