Microsoft Word 2007 ichrie conference Proceedings Final-Final 06-06-07. doc

 
2007 Annual International CHRIE Conference & Exposition 
139
leverage have an inverted U shaped relationship with performance.
) can be tested by equation 3. A significantly 
negative 
γ
2
would indicate an inverted U shaped relationship between internationalization and performance and 
γ
4
for leverage likewise. Hypothesis 3
 (Internationalization and leverage has an inverted U shaped relationship.) 
is 
tested by the significance of the coefficients of squared terms, 
α
2
and 
β
2
. Significant negative signs of 
α
2
and 
β
2
would indicate an inverted U shaped relationship. Hypothesis 4 (
Internationalization and leverage have a reciprocal 
relationship.
) will be supported if the relevant coefficients are significant simultaneously. The significance of 
α
1
and/or 
α
2
indicates leverage as a determinant for internationalization, while the significance of 
β
1
and/or 
β
2
indicates 
internationalization as a determinant for leverage. Finally, hypothesis 5 (
Internationalization and leverage 
moderates each other’s impact on performance.
) can be examined using the results of equation 3 by following the 
procedures layout by Baron and Kenny (1986) as below.
0
3
≠
γ
and/or
0
4
≠
γ
, and
0
5
=
γ
Leverage affects performance directly. 
0
3
=
γ
and
0
4
=
γ
, and
0
5
≠
γ
Leverage is a pure moderator on internationalization. 
0
3
≠
γ
and/or
0
4
≠
γ
, and
0
5
≠
γ
Leverage is a quasi moderator on internationalization. 
The same procedure can be followed to check internationalization’s moderating effect on leverage by substituting 
γ
3
with 
γ
1
, and 
γ
4
with 
γ
2
.