Journal of Applied Finance & Banking

The Internationalization-Performance Relationship of Small-and-Medium-sized Enterprises: The Case of Taiwan’s ESCO Industry

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  • Abstract


    We analyze the international output patterns with Taiwan’s energy service companies (ESCOs) investigated in 2016~2019. Due to the finite demand in Taiwan energy-saving market, half of Taiwanese ESCOs develop Asia Pacific markets with international trade, alliance and enterprises group. We derive and confirm some hypotheses about international developing patterns of Taiwanese ESCOs.

    The First is that those firms with more specific resources will be easier to promote the internationalization of energy-saving businesses. The specific resources are confirmed as firm capital, annual ESCO sales, net income ratio, annual growth rate, energy saving rate. Secondly, if the degree of internationalization of ESCOs is greater, the overall profitability is also relatively higher. The third, the relationship between internationalization and profitability of ESCOs displays a non-linear trend which means when the export ratio is low, the profit from energy service projects increases; however, when the ratio exceeds the optimal point, about 49.584%~54.323%, it will reveals a reversed phenomenon due to high overseas operation costs.


    JEL classification numbers: F23, F37.

    Keywords: Energy Services Companies, Internationalization, Output Patterns, Mediational Effect.