Abstract
This thesis examines Chinese SMEs and focuses on their internationalisation. It explains how and why these SMEs internationalise with the influence of both networks and institutions. It contributes to the internationalisation theory by providing an integrated network and institutional approach. It also contextualises this theory, which was mainly developed by studies on developed economies, to the emerging economy of China.
Thus, this study investigates the integrative influence of both networks and institutions on Chinese SMEs’ internationalisation. It focuses on the specific patterns of foreign market selection, entry mode, and the pace of these SMEs during internationalisation. It also concentrates on the influence of three types of networks (business, social and mixed) and three dimensions of institutions (regulative, normative and cognitive).
This thesis adopts a multiple case study approach based on qualitative data, as this thesis is a theory-building study. The data collection process has been conducted in eight SMEs in China through twenty-five interviews and observation. The research author has interviewed and visited these firms twice during a two-year period. Also, this research takes an ‘abduction’ process in which empirical observations and findings are continuously connected to existing literature to generate explanations.
This study found that networks and institutions both influence Chinese SMEs’ internationalisation; specifically, networks are influenced by institutions. In addition, the internationalisation of Chinese SMEs can be explained by the paradoxes that co-exist when networks and institutions are integrated. While networks and institutions can support Chinese SME internationalisation they can also hinder the process.
For future research, this study provides an integrative approach to incorporating networks and institutions to explain SMEs’ internationalisation. In addition, adopting the paradoxical view is a promising start to explain international business especially in the context of China. The practical implications are that SMEs can learn how to use different types of networks for success in turbulent transitional institutions. Policymakers could enhance their knowledge of how to facilitate SMEs to internationalise successfully by providing a supportive institutional environment.