The Engine of Expansion: How Network Capital Fuels SME‎Internationalization through Innovation Strategy

  • Authors

    • Ju Hang School of Business Management, Northern University of Malaysia, Malaysia
    • Shamsul Huda Abd Rani School of Business Management, Northern University of Malaysia, Malaysia
    • Mohamad Hanif Abu Hassan School of Business Management, Northern University of Malaysia, Malaysia
    https://doi.org/10.14419/921bmz61

    Received date: January 29, 2026

    Accepted date: February 4, 2026

    Published date: February 10, 2026

  • Network Capital; SME Internationalization; Innovation Strategy; Government Policy

  • Abstract

    Demonstrating that they draw on network capital, the internationalization of small and medium-sized enterprises (SMEs) is a resultant ‎innovation strategy. In this study, which focuses on network theory and the resource-based view, we aim to investigate the intermediary role ‎of innovation strategy and how traits in China's entrepreneurial system can moderate the direct correlation between network capital & ‎internationalization. Specifically, we seek to understand how reliant China is on others for networking resources. Based on survey data from ‎‎342 Chinese hi-tech SMEs, structural equation modeling analysis reveals that network capital has a significantly positive impact on ‎internationalization performance through access to various resources, social networks that can directly lead to market entry, and partnerships ‎with influential partners, including customers, suppliers, and competitors. These relationships are partially mediated by innovation strategy. ‎Again, government policy support makes the connection between network capital and innovation strategy stronger. However, the study ‎reveals that the development of SMEs 'internationalization process is based on a solid foundation of micro-level factors. It expanded by ‎virtue of these issues faced by small and medium-sized enterprises from third-world countries entering first-world markets. For ‎policymakers and managers, there are several practical implications of this research‎.

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  • How to Cite

    Hang , J. ., Abd Rani, S. H. ., & Abu Hassan, M. H. . (2026). The Engine of Expansion: How Network Capital Fuels SME‎Internationalization through Innovation Strategy. International Journal of Accounting and Economics Studies, 13(2), 75-81. https://doi.org/10.14419/921bmz61