Do Internationalization Breadth Speed and Depth Speed Influence a Firm’s Re-entry Decision?: The Moderating Role of Financial Slack

Although the concept of re-entry is not very new in International Business studies, extant studies neglected to explore the research topic. In particular, although internationalization speed – time dimension – has long been regarded as a salient factor that shapes a firm's internationalization process, very little is known about how and whether internationalization speed influences a firm’s re-entry decisions. To address research gaps, by drawing on the Uppsala model and the theoretical concepts of internationalization breadth and depth while using 396 Japanese multinational enterprises from 2010 to 2020, the binary logit regression estimation results reveal that internationalization breadth and depth speed are positively associated with a firm's re-entry decision. Moreover, based on the theoretical concept of financial slack, this study further found that financial slack positively moderates the relationship between internationalization speed and a firm's re-entry. The results of this study imply that diverse and sophisticated knowledge accumulated in the past by staying in foreign countries longer may be significant to making re-entry decisions and escalating commitments. This study also generates meaningful implications suggesting that the financial slack is salient in mitigating financial costs and pressures relevant to re-entrants, thereby positively affecting a firm's re-entry decision.