A Study On Degree Of Internationalization Of Private Enterprises And Enterprise Performance

With the development of economic globalization,more and more companies are keen on international development.Enterprises in developed countries with the advantages of internalization and location,have occupied a large number of overseas markets and achieved good business performance by virtue of their inherent ownership advantages.Throughout China,as the international competitiveness of the Chinese economy continues to increase,the Chinese government has formulated a policy to promote and encourage enterprises to “go global”.More and more enterprises have implemented international development strategies,including private enterprises.Internationalization can help companies acquire strategic resources,occupy overseas market share and enhance their international competitiveness.However,there are many unknown and unpredictable risks outside.Then,can private enterprises improve corporate performance by implementing internationalization strategies? Since China is currently in transitional economy,the basic system has not been constructed perfect,private enterprises are in a “weak” position compared with state-owned enterprises.In order to improve the competitiveness of enterprises,private enterprises try to rely on political connections to support their international expansion.It's necessary to explore the impact of political connections on the degree of internationalization and corporate performance.At the same time,the institutional environment in different regions of China is quite different.Under different institutional environments,will the influence of political connections be different due to differences in different institutional environments? Therefore,this paper takes the relationship between internationalization and corporate performance as the research center,and then deeply explores how political connections affect the relationship between internationalization and corporate performance,and explores the influence of political connections in different institutional environments according to institutional environmental differences.This paper takes the private enterprises listed on the Shanghai and Shenzhen Exchange in 2012-2016 as a research sample,explores the relationship between the degree of internationalization of private enterprises and corporate performance,and subdivides the dimensions of internationalization as international breadth and international depth.The paper explores political connections play a moderate role in the relationship between the degree of internationalization and the performance of private enterprises and whether the different institutional environment where the enterprise locates make significantly differences between the degree of internationalization and corporate performance.Finally,the conclusions of this study indicate that:(1)The degree of internationalization of private enterprises is positively correlated with corporate performance.The depth of internationalization of private enterprises is positively correlated with corporate performance.The breadth of internationalization of private enterprises is positively correlated with corporate performance.The effect of international depth is significantly higher than the effect of international breadth on corporate performance.(2)Political connections positively moderate th relationship between the degree of internationalization of private enterprises and corporate performance.Politica connections positively moderate the relationship between international depth of private enterprises and corporate performance.Political connections positively moderate the relationship between international breadth of private enterprises and corporate performance.And the political connections have a more pronounced effect on the relationship between international depth and corporate performance.(3)The more backward the institutional environment in which the enterprise is located,the greater the positive adjustment effect of political connections on the degree of internationalization and corporate performance,the greater the positive adjustment effect of political connections on international depth and corporate performance,the greater the positive adjustment effect of political connections on international breadth and corporate performance.For the developed areas of the institutional environment,the regulatory role of political connections is not much different.However,for the backward areas of institutional environment,political connections' adjustment effect between international depth and corporate performance is greater than that between international breadth and political connections.Compared with the previous literature,this article has some innovations in the following aspects:First,this paper constructs a multi-dimensional internationalization measurement index system to explore the differential impact of different internationalization strategies on corporate performance.Second,this paper introduces the external factor of political connections and explores the moderate role of political connections in the relationship between internationalization and corporate performance.Third,this paper subdivides the different institutional environments and explores the differences in the moderate role of political connections in the relationship between internationalization and corporate performance in different institutional environments.