Maximizing the Benefits of Internationalization: The Moderating Role of Labour Flexibility

Using the large-scale Korean Workplace Panel Survey, this study explores the interplay between international diversification, labour flexibility, and workplace-level performance. We elucidate two distinct types of labour flexibility as moderators of the impact of international diversification on financial performance. The results show that functional flexibility strengthens the positive impact of international diversification on financial performance, whereas numerical flexibility weakens it. Therefore, our study suggests that the quality of human resources and a well-designed workplace configuration play a crucial role in achieving the intended effects of international diversification. It also provides insight into employment relations in advanced emerging markets marked by a small, open economy structure, government-aided international experience, and conflict-laden labour relations.