AbstractsBusiness Management & Administration

The International Diversification of Professional Service Firms: The Case of U.S. Law Firms

by Patrick H Gaughan

Institution: Cleveland State University
Department: Monte Ahuja College of Business
Degree: Doctor of Business Administration
Year: 2015
Keywords: Business Administration; Internationalization; International diversification; Professional services; Law firms; Law firm; Rubric; Descriptive; Statistics; Human capital; Reputational capital; Leverage; Diversification
Record ID: 2060399
Full text PDF: http://rave.ohiolink.edu/etdc/view?acc_num=csu1431259487


The globalization of markets has necessitated increased demands on law firms to serve the international needs of their clients. However, it is unclear how law firms have met these needs. Although the internationalization process of U.S. law firms has been the subject of some limited academic discussion, the overwhelming focus has been on only the largest law firms. There is a noticeable absence of empirical analysis that defines, let alone includes, the broader population of U.S. law firms who maintain international operations. Moreover, the existing literature has not proposed any parsimonious international diversification models that are easily applied to the entire population of U.S. law firms. This includes consideration of Reputational Capital as a firm resource impacting law firm internationalization. This dissertation helps fill the gap. The descriptive statistics are based upon a census of internationally diversified U.S. law firms at four points in time. Additionally, the quantitative research is based upon a panel study consisting of virtually all U.S. law firms that maintained at least one attorney outside the U.S. across all of the years 1998, 2003, 2008 and 2013. This ultimately resulted in a panel study consisting of four observations on each of fifty-five (55) U.S. law firms (for a total of 220 observations). The results revealed that, as related to International Diversification, the interaction of Human Capital and Reputational Capital was negative and statistically significant. This suggests that U.S. law firm internationalization may be different than has been assumed in the previous literature.