Early internationalization and subsequent geographic expansion: An extended Penrosean perspective

Internationalization is, by nature, a dynamic and continuous process that unfolds over time. However, the extant literature on international entrepreneurship primarily focuses on the antecedents that influence the initiation of internationalization and downplays its post-entry process. Specifically, little research has examined how early internationalization relates to subsequent geographic expansion. To bridge this gap, we draw upon Penrose's theory of firm growth and a judgment-based view of entrepreneurship. We posit that earlier resource commit-ment to foreign countries enables entrepreneurs to quickly start managerial learning based on their experience of experimentation activities in foreign markets, facilitating entry into new foreign markets. Especially, we hy-pothesize that the operational experience acquired through earlier foreign direct investment is positively asso-ciated with subsequent geographic expansion, and the location where to accumulate operational experience moderates the association. The results of our longitudinal 19-year (2000-2018) study on 75 Japanese early internationalizing firms provide evidence for our hypotheses.