How global are German corporations? An empirical investigation

Abstract

The internationalization of firms has been subject of much debate in the field of international business, with many studies examining firm-level internationalization using a number of different measures, but few investigating changes in these measures over time. In order to contribute to closing this gap, we conduct a longitudinal study of the patterns of internationalization of 164 German firms from the Thomson Reuters Germany Equity index between 1998 and 2015, contributing to the debate surrounding regionalization or globalization at the firm level. To capture different aspects of multinationality, we measure both the extent and scope of internationalization, measuring extent using percentage foreign sales, and scope using the number of geographic segments that firms report material sales in and the number of world regions in which those sales occur. We further categorize these measures of internationalization over time within categories of age, size, and industry. A strong trend towards globalization is revealed, with most firms reporting foreign sales outside of Europe and very few operating in this region only.