The Role of Political Intelligence in Firms’ Export Decisions During the Euro Crisis
21 Pages Posted: 26 Sep 2016
Date Written: October 2016
Inspired by the literatures on internationalization and absorptive capacity, we develop a model exploring how small firms - during crises - acquire and apply political information to export decisions. We test our model using data collected during the 2012 Eurozone crisis from a sample of 440 British, French, and Swedish SMEs. Findings indicate that firms dependent on the Eurozone for exports and heavily impacted by the crisis engaged in frequent political monitoring. In turn, frequent monitoring leads to the development of formal routines for exploiting political information. Firms with the most formal routines sought new export opportunities beyond the Eurozone. In contrast to previous research into small‐firm internationalization, our study stresses the significance of “shortcut” searching activities, non‐market information, and firms’ decisions to reduce prior investments in export markets.
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