Outward foreign direct investment from emerging countries: theoretical extension and evidence from China

Internationalization of emerging market firms (EMFs) is challenging pre-eminent theories. This article argues that no single existing theory adequately explains EMFs’ pattern for overseas investment. Using case studies and a multi-level approach, our research suggests that EMFs can be categorized into four different clusters based on different rationales, objectives, and motivations. Our findings suggest that existing theories can be useful for explaining the process of internationalization, but this holds only for specific clusters. This is of particular importance for EMFs since the presence and influence of the state on EMFs internationalization is both critical and diverse from developed economies.