Global Studies Centre Seminar with Dr Giuseppe Criaco (Erasmus University)

Internationalization Shocks and Entrepreneurial Activity: Evidence from Foreign Acquisitions

Abstract

This paper examines how experience working in foreign-owned firms influences employees’ entrepreneurial activities. International exposure provides employees with knowledge about foreign operations and markets, enhancing their ability to identify and exploit entrepreneurial opportunities. A key challenge in assessing this relationship is the potential self-selection of more skilled workers into foreign-owned firms, which may bias estimates of the effect of international experience. To address this, we compare future entrepreneurial activities of employees in Swedish firms that are eventually acquired by foreign firms to those in firms that remain domestically owned. Specifically, we track employees in local Swedish firms, some of whom experience an ‘internationalization shock’ when their firm is acquired by foreign owners. By matching acquired firms with comparable control firms and employing a stacked difference-in-differences estimation approach, we find that international experience increases the likelihood of employees starting a new venture. Moreover, ventures founded by former employees of firms acquired by foreign investors are more likely to internationalize and achieve superior performance than those started by former employees of firms that remained domestically owned.

About the speaker

Giuseppe Criaco is an Associate Professor of Entrepreneurship at the Rotterdam School of Management, Erasmus University (RSM). His research focuses on firms with concentrated ownership, such as new ventures and family firms, exploring how owners’ preferences, motivations, and experiences shape their strategies and outcomes. Giuseppe’s work has been published in leading academic journals, including the Journal of Management, Journal of International Business Studies, Journal of Business Venturing, Strategic Entrepreneurship Journal, and Entrepreneurship Theory and Practice. He also serves on the editorial boards of the Journal of International Business Studies and Journal of Business Venturing.