Domestic Business-to-Business Relationships and the Internationalization of SMEs

Relationships and networks are considered to play an important role in the internationalization process of firms. Our paper addresses this issue, by investigating the link between domestic business-to-business relationships and the internationalization of firms using a sample of 502 Swiss small and medium-sized enterprises (SMEs). Following a two-step approach we analyze how transactional relationships between SMEs and domestic companies listed at the stock exchange influence the export propensity and export intensity of SMEs. Our empirical results reveal heterogeneous effects of these relationships. While the domestic business-to-business relationships increase the export propensity of SMEs they decrease their export intensity.