Business group reputation and affiliates' internationalization strategies

The literature on business groups (BGs) has identified reputation as a critical factor in their success and survival. However, most studies have assumed that BGs are well-known and well-regarded-an assumption that may not be tenable in the context of international expansion. We use signaling theory to explore the causes of an unacknowledged source of BG heterogeneity-variance in their reputation prominence (whether they are well-known or not) and reputation quality (whether they are regarded favorably or unfavorably)-and seek to understand how this heterogeneity may result in differences in BG affiliates' geographic scope and location choices as they internationalize.