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Home country uncertainty and the internationalization-performance relationship: Building an uncertainty management capability

Research output: Contribution to journalArticlepeer-review

Alvaro Cuervo-Cazurra, Luciano Ciravegna, Mauricio Melgarejo, Luis Lopez

Original languageEnglish
Pages (from-to)209-221
Issue number2
Early online date2 Dec 2017
Accepted/In press19 Nov 2017
E-pub ahead of print2 Dec 2017
PublishedFeb 2018


King's Authors


We analyze the impact of home country uncertainty on the internationalization-performance relationship of emerging market firms. Building on organizational learning theory and the institutional approach, we argue that internationalization has a positive impact on the performance of emerging market firms, and that this relationship is strengthened for firms based in emerging countries with higher corruption and political risk. The reason is that by being exposed to high levels of home country uncertainty in the form of political risk and corruption, firms develop an uncertainty management capability at home that helps them face the challenges of internationalization better. We also propose that this uncertainty management capability helps emerging market firms perform better outside of their home region. We test our arguments on a sample of 536 firms from Argentina, Brazil, Chile, and Peru.

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