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Abstract
This research attempts to contribute to the study of internationalized firms from emerging markets by analyzing the different ways in which internationalization has evolved in Argentina, Brazil and Chile. It explores the process of firms’ internationalization from a state-centered perspective. This study identifies three key mechanisms by which state actions shape the way firms internationalize. Privatizations, policies to improve capital availability, as well as the intertemporal viability of the general set of public policies and the institutional environment (promoted by the state) are the key variables that will be used to assess how state actions influence firms’ expansion abroad. The hypothesis that will be tested throughout this research is that an active state, which develops a coherent inter-temporal set of public policies, improves the conditions for firms’ internationalization. The provision of signals for institutional continuity is also essential for encouraging competitive behavior among firms. There are a vast number of signals and state actions that create different types of firms' internationalization.
Brazil, the country in which the state has been more actively involved in the economic process and it is the one with a higher level of firms' internationalization. The Brazilian government has supported the creation of national champions with the potential to expand abroad by different measures, including: financial support (through the BNDES), creation of large specialized firms in the process of privatization, and providing proper signals for business. The Chilean state has managed to encourage a significant internationalization of its firms through selective incentives and pro-market institutions. The Chilean government has also used selective non-market incentives and direct intervention in the oil & gas as well as the forestry sectors. Still, pure pro-market institutions are not enough to assure the consolidation, and trigger the internationalization, of firms in heavy industries. Argentina had the worst results in terms of firms' internationalization. This country did not provide stable institutions and predictability. Economic reforms and a weak bureaucracy have negatively affected the state's capabilities to regulate the market and proper signals could not be created, which have ultimately discouraged firms’ internationalization.
