How does export commitment and product diversity affect the international scope-firm performance relationship?: Evidence from Japan

Abstract

We examine the relationships among international operational scope, export commitment, product diversity and firm performance. In our sample of the largest Japanese electronics firms, we find that the performance impact of international operational scope changes, depending upon the extent of a firm's export commitment and product diversity. The results suggest that exporting and product diversity, separately and jointly, moderate the relationship that international operational scope has with performance. Our three-way interaction results show that multinational firms can successfully mitigate the profitability losses that a firm potentially faces when they simultaneously commit to high levels of product diversity and export activities. © 2013 Macmillan Publishers Ltd.