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Verbeke, A. (2026) The future of international business strategy research. International Business Review. ISSN 0969-5931 (In Press)
Abstract/Summary
Internalization theory has served for five decades as the principal framework for understanding multinational enterprises, yet its initial emphasis on transaction cost economizing left underexplored the behavioral foundations of commitment failures, cross-border value creation, and governance evolution. This article articulates the New Internalization Theory (NIT), which preserves the core comparative governance logic while providing several extensions. NIT comprises six recursive stages: entrepreneurial judgment, comparative institutional evaluation, governance architecture design, resource bundling, dynamic capability development, and performance outcomes. It introduces bounded reliability as a complement to bounded rationality, positions resource bundling—combining firm-specific advantages with host-country complementary resources—as the central value creation mechanism and incorporates dynamic capabilities through FSA-recombination across institutionally heterogeneous environments. Two cross-cutting parameters shape NIT: artificial intelligence, transforming bounded rationality, bounded reliability, and FSAs; and the political license to operate, defining the value space in geopolitically contested environments. Fifteen propositions suggest how to operationalize the framework.
| Item Type | Article |
| URI | https://centaur.reading.ac.uk/id/eprint/129200 |
| Refereed | Yes |
| Divisions | Henley Business School > International Business and Strategy |
| Publisher | Elsevier |
| Download/View statistics | View download statistics for this item |
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