Network Effects and Multi-level Dynamics in the Internationalization of Digital Platforms: A Reflection

While international business research has provided insights into the cross-border strategies and operations of firms in the manufacturing sector, understanding about service sector internationalization is less developed. This is especially important in light of the recent, rapid rise of digital businesses that now dominate the global economy. Understanding firms that operate using digital platforms requires a clear understanding of network effects, especially in terms of internationalization. Both the nature and the level (local, national, regional, or global) of the relevant network effects play roles in multinational enterprises’ incentives for internationalizing, their foreign entry choices (particularly with respect to sequencing), and the political interactions between businesses and the environments in which they operate.