SMEs Performance and Internationalization: A Traditional Industry Approach

This study approaches the internationalization-performance (I-P) relationship following an innovative strategy, using DEA to calculate a financial performance metric that considers several financial indicators. We then apply a truncated regression to evaluate the relationship between financial performance and internationalization for a sample of firms in the footwear Portuguese industry for the period 2010-2013, using several controls, while exploring potential non-linear effects. Results tend to support the conclusion that export participation leads to increased efficiency, eventually through the so-called learning effects. For our case, the relationship is U-shaped. So, beyond a certain level the degree of international engagement might compromise efficiency.