How Firms Learn at Home and Abroad: The Roles of Early Expansion and Entrepreneurial Drive

What is it about?

This study explores why some firms invest more effort in learning from international markets than others, and how this differs from the effort they devote to learning domestically. By integrating learning theory with the attention-based view of the firm, the research examines how three key factors—the extent of a firm’s internationalization, the timing of its first international entry, and its entrepreneurial orientation—shape its learning behavior both abroad and at home. Using data from independent firms, the study shows that those expanding abroad early and with stronger entrepreneurial orientations foster active learning both internationally and domestically. However, a firm’s overall internationalization does not always boost learning abroad; high global reach can even reduce learning at home as attention and resources stretch across markets. The results suggest that learning depends less on experience breadth and more on entry timing and entrepreneurial mindset. For entrepreneurs, the research highlights the importance of maintaining balanced learning efforts across markets. Early internationalization and an entrepreneurial spirit can enhance global knowledge acquisition, but organizations must also ensure they continue to learn from their domestic environments. Neglecting local learning can lead to missed opportunities for innovation and operational improvement.

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Photo by Alexandr Podvalny on Unsplash

Photo by Alexandr Podvalny on Unsplash

Why is it important?

This study advances understanding of the learning processes that underlie international expansion by distinguishing between domestic and foreign learning efforts. It challenges the assumption that internationalization automatically leads to stronger learning, showing that the timing of international entry and entrepreneurial culture are more decisive than scale alone. By linking learning theory with the attention-based perspective, the study provides valuable insight into how firms allocate their limited cognitive and strategic resources. It also offers practical lessons for leaders seeking to balance exploration abroad with exploitation at home—an enduring tension for firms navigating globalization and innovation simultaneously.