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Three Studies on Networks, Internationalisation, Innovation for Chinese Small and Medium-Sized Enterprises (SMEs)

Caifei, C. (2022). Three Studies on Networks, Internationalisation, Innovation for Chinese Small and Medium-Sized Enterprises (SMEs). (Unpublished Doctoral thesis, City, University of London)


This PhD thesis uses the network theory to explore how small- and medium-sized enterprises (SMEs) efficiently use and leverage networks to capture internationalisation opportunities in the context of China. Drawing on an extensive assessment of research from multiple sources, it shows three interconnected empirical studies that provide several contributions to the international business (IB) field.

The first study provides a literature review of the network approach in the IB field: (1) it takes stock of the growing literature of the network approach by identifying the major network theory approaches employed, the ways in which the types of networks have been conceptualised and measured and the theoretical mechanisms proposed; (2) it synthesises and analyses the literature by identifying robust findings on the main themes in international network research theories; (3) for content analysis, this article selects observations about the underexposure of developing countries in IB network research as a starting point to investigate home- and host-country settings in the articles included in this sample; (4) it provides up-to date and comprehensive research agenda into the network theory in the IB field.

The second study addresses the research question: ‘How do domestic networks influence Chinese SMEs’ internationalisation propensity?’ It contributes to the literature by analysing the impact of different types of domestic formal (sponsorship-based linkages and partnership-based linkages) and informal networks on the SMEs’ internationalisation propensity in emerging markets. Drawing on network perspectives and social network theory, this study builds on prior work that suggest that informal and formal domestic networks facilitate Chinese SMEs’ internationalisation activities in the early stages. Second, this study examines that domestic formal sponsorship-based linkages are stronger than domestic formal partnership-based linkages for Chinese SMEs’ internationalisation propensity. Informal networks are stronger than formal networks. Third, the moderating role of absorptive capacity establish in informal networks. Lastly, it proves that there are no mutually reinforcing effects between informal and formal networks and the internationalisation propensity of SMEs.

While there has been considerable research on dynamic capabilities in internationalisation expansion, there remains fragmentation and lacking knowledge on their role in supporting entrepreneurial innovation in foreign markets. By drawing on dynamic capabilities, the third study contributes to bridging this gap by studying how the dynamic managerial and networking capabilities of Chinese SME entrepreneurs influence how their firms innovate when expanding internationally. The main finding suggest that there is a negative relationship between internationalisation and innovation for Chinese SMEs. Additionally, the dynamic capabilities can positively moderate the above-noted negative relationship. We found no evidence to prove any mutually reinforcing effects between these strategies. This study provides unique insights into the Chinese context and international entrepreneurship (IE) literature.

Publication Type: Thesis (Doctoral)
Subjects: H Social Sciences > HD Industries. Land use. Labor
Departments: Bayes Business School > Bayes Business School Doctoral Theses
Bayes Business School > Management
Doctoral Theses
[thumbnail of Caifei Thesis 2022 PDF-A.pdf] Text - Accepted Version
This document is not freely accessible until 31 July 2026 due to copyright restrictions.


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