International diversification and economic development in a regional context: A dynamic capabilities approach

Abstract

This exploratory study proposes a theoretical framework grounded on the dynamic capabilities approach to facilitate understanding of the role of managerial resources and dynamic capabilities in international diversification (ID) initiatives in a changing business environment in the context of Western Australia (WA). Data were gathered through interviews with representatives of this state’s chambers of commerce, government agencies and town halls. While the identified ID strategies will not replace the state’s ubiquitous mining industry, these were nevertheless perceived as significant contributors to its future economic performance. The strategies primarily emphasised the potential and value of further developing tourism, international education, innovative and technological resources, and premium agricultural products. The proposed framework provides an interpretative and guiding tool, which highlights the strategic importance of a region’s alternative resources as contributors to its diversification, economic development, and competitive advantage. In addition, the study will discuss various implications from the findings and identify future research strands.