Enterprise‐level training in developing countries: do international standards matter?*

Several studies have examined the determinants of training in developing countries but few have paid attention to the potential importance of international standards such as ISO 9000 or ISO 14000 on the firm's training decision. This article examines training determinants using recent employer surveys for five developing countries: Ethiopia, Honduras, Indonesia, Morocco and Nicaragua. It finds that ISO certification status is an important determinant of training, even after controlling for other characteristics such as workers’ formal schooling, firm size, industry and foreign ownership. This points toward the importance of international standards, including product quality and production standards, for firm training. The article also discusses policy implications related to the findings and provides directions for further research.     

The Determinants of the Location of Foreign Direct Investment by Japanese Small and Medium-sized Enterprises

Japanese manufacturing small and medium enterprises (SMEs) have actively undertaken Foreign Direct Investment (FDI) in Asia since the mid-1980s. FDI contributes to economic growth of the FDI recipient countries, as it brings in not only financial resources for investment but also technologies and managerial know-how, which are important factors for promoting economic growth. Recognizing these benefits of receiving FDI, policy makers in developing countries have formulated various strategies to attract FDI. This paper examines the factors in the host countries that would attract FDI by Japanese SMEs. Our results show the importance of both supply-side and demand-side factors in the recipient countries for attracting FDI by Japanese SMEs. Supply-side factors include abundance of low-wage labor, availability of well-developed infrastructure, and good governance of the host government, while an important demand-side factor is the presence of sizable local market. In addition, Japanese SMEs regard industrial agglomeration, which has a element of both supply and demand factors, as an important factors making FDI decision. Supply-side factors are found to be important for attracting Japanese FDI in developing countries, while demand-factors play a role in attracting Japanese FDI in developed countries. A comparison of the results for SMEs to those for large firms reveals that SMEs are more sensitive to the conditions in the host countries in making their FDI decision. In particular, SMEs regard the availability of low-wage labor, well-developed infrastructure, and industrial agglomeration as important elements much more than large firms. High sensitivity of SMEs to local economic conditions in their decision on FDI location may be explained by their limited availability of financial and human resources and high dependence on overseas production in their business. In light of these findings, we conclude that countries interested in hosting FDI have to provide a very attractive business environment.     

Firm Heterogeneity,Origin of Ownership and Export Participation

This paper investigates the relationship between firm heterogeneity and a firm’s decision to export, using the annual survey of Thai manufacturing firms from 2001 to 2004. A significant contribution of this paper is that we are, for the first time, able to break down FDI by country of origin to observe whether the behaviour of MNEs differs by region of origin. We find that sunk entry costs and firm characteristics are important factors in explaining a firm’s decision to export. Another important determinant is the ownership structure of the firm, with foreign‐owned firms having a higher probability of exporting than domestically owned firms, although this differs across country of ownership with potentially important policy implications. Export platform FDI is used to explain the behaviour of foreign firms that invest in Thailand. Using three measures of total factor productivity, we also find that highly productive firms self‐select into the export market. The implication for governments of developing countries is the need to think carefully about how and to whom they target their inward FDI policies as a means of growth. The heterogeneous behaviour of multinationals from different nations means that policies targeting specific regions or countries may be preferable to general tax concessions or the implementation of special economic zones that are open to all.     

The Renaissance of State‐Owned Multinationals

State‐owned multinational enterprises (SMNEs) have significant levels of state ownership and value‐adding activities outside their home countries. SMNEs are undergoing a renaissance, highlighted by their numbers in the global economy and their heightened importance; as a result, they are gaining new attention in the academic literature and in the popular press. This work discusses the reasons for this renaissance and examines the challenges involved in managing SMNEs. SMNEs represent a hybrid organizational form with the dual characteristics of both the state‐owned enterprise (SOE) and the multinational enterprise (MNE). When compared with private MNEs, SMNEs are generally less profit oriented and have a more complex corporate governance structure. They have less autonomy to establish their strategies, but also experience a lower level of uncertainty in their external environment. As a result, SMNEs have more difficulty than private MNEs in developing strategies and making organizational changes. Our study concludes with recommendations to managers for improving SMNE performance. © 2015 Wiley Periodicals, Inc.     

我国双向投资的发展阶段及对策

利用外资与对外投资已经成为发展中国家参与经济全球化与国际竞争的重要手段。外资的流入不仅带来了资本,还带来了技术和知识等企业经营资源,改变了发展中国家的要素禀赋、比较优势、经济结构、市场容量。发展中国家企业所有权优势的增强和国家区位优势的改善最终会促使发展中国家的企业进行对外直接投资。本文运用投资发展周期理论,实证检验得出目前我国双向投资已经进入第三发展阶段的结论。为此,我国应从企业和政府两个方面增强企业所有权优势和国家区位优势,促进双向投资协调发展。     

Contextualizing experience effects in international business: A study of ownership strategies

Experienced firms act differently than newcomers, yet such differences vary with the context and with the type of experience. This research examines the effects of international experience on multinational enterprises’ (MNEs’) ownership strategy across a range of developed and developing economies. We distinguish competence-building and partner-selection effects of experience, which vary between general international experience and country-specific experience, and across host contexts. This contextualization of the theoretical arguments suggests that the predicted effects hold in some host countries, but not in others. In support of these arguments, our empirical study of subsidiaries of Taiwanese electronics forms finds that general international experience facilitates wholly owned operations in developed economies in Asia and Europe, while country-specific experience facilitates joint ownership in China.     

发达国家和发展中国家企业对外直接投资动机--基于文献综述的比较研究

在全球经济一体化背景下,企业对外直接投资行为的兴起激发了国内外学术界对其动机的研究。发展中国家和发达国家由于市场发展程度存在较大的差别,企业对外直接投资动机也大相径庭。通过对比归纳发现,发达国家企业对外直接投资动机较为集中,受东道国因素影响较多并大多有市场推动;而发展中国家企业对外直接投资动机较复杂多样,主要受母国因素影响且政府政策推动具有较大作用。这一比较研究也表明,在我国针对企业对外直接投资经济影响的研究中,应先考虑并区分不同动机企业对外直接投资产生的差异化结果。     

Determinants of dividend smoothing in emerging market: The case of Korea

Dividend smoothing is a well-established empirical fact in developed countries. This paper investigates the dividend smoothing behavior in Korea where the tax regime and institutional settings of the financial market are different from those of developed countries. The empirical evidence shows that the dividend smoothing decision is influenced not only by a firm's characteristics, but also by macroeconomic factors such as tax and interest rates. Detailed results are as follows. First, application of the Lintner model shows that the extent of dividend smoothing in Korean firms is found to be less than that in the U.S. firms. Second, size, risk, growth and large shareholder ownership are found to be important determinants of dividend smoothing. Larger firms and lower growth firms smooth dividends more. Riskier firms tend to smooth more during the sample period while safer firms smooth dividends more for the post-liberalization period. These results are not consistent with the predictions of information asymmetry models. In addition, contrary to the agency theory based explanations of dividend smoothing, firms with concentrated ownership smooth dividend more. Finally, as for the effect of macroeconomic factors on dividend smoothing, both tax and interest rates are found to have significantly positive relationships with the degree of dividend smoothing. These findings suggest that institutional factors of financial market can play a critical role in understanding the dividend behavior in emerging markets.     

双缺口模型与东北老工业基地的引资战略选择

钱纳里等人提出的双缺口模型为发展中国家引进外资提供了理论基础,目前东北老工业基地引进外资不应单纯局限于弥补储蓄缺口和外汇缺口的层次上,而应转向以弥补其他缺口为主。东北地区应利用自身优势,加大引资力度,促进产业结构调整和快速升级。     

新自由主义政策实践考察和反思

20世纪80年代末期，在西方兴起的新自由主义思潮迅速在全世界开始流行。作为一种经济思想流派体系，新自由主义本质上就是一种市场原教旨主义。近20多年的实践表明，无论是在西方资本主义发达国家．抑或是社会转型国家，还是在新兴工业体国家，新自由主义的政策主张不仅没有达到预期目标，反而造成了更为深刻的社会经济问题。对于正处于经济体制转型时期的中国而言。可以主要从所有制、公共服务机制和政府职权范围三方面得到启示和借鉴。     

Direction of outward FDI of EMNEs: Evidence from the Indian pharmaceutical sector

This article seeks to add to the small but growing literature of emerging‐market multinational enterprises (EMNEs). Using two linked large firm‐level databases, it seeks to explore the determinants of outward investment of Indian pharmaceutical companies, distinguishing between developed‐ versus developing‐country destinations. It specifically examines the impact of two firm‐level characteristics that embody “non‐OLI” [ownership, location, and internalization] firm‐specific capabilities of EMNEs. The finding of this study is that family firms are keen on investing in other developing countries but much less so in developed countries. However, international linkages in the form of foreign investors offset this. © 2011 Wiley Periodicals, Inc.     

Branding in a global marketplace: The mediating effects of quality and self-identity brand signals

Research documents that consumers with a stronger belief in global citizenship through global brands (GCGB) view branded products as more important and prefer global to local brands. We test the mediating effects of consumer use of quality and self-identity brand signals on the relationships between GCGB and the importance attributed to branded products (Study 1: U.S. and Russia) as well as purchases of global brands (Study 2: U.S., U.K, and Russia). Our research establishes that consumer involvement with branded products and purchases of global brands revolves around consumers' use of brands as signals of quality and self-identity. In the developing country, results document mediation effects for the use of both quality and self-identity signals on the importance of branded products and global brand purchases. In developed countries, we find that the importance of branded products is explained by a greater use of brands as self-identity signals, whereas purchases of global brands are explained by a greater use of quality signals. Overall, consumers with a stronger belief in GCGB are more likely to use brands as symbolic signals and to express their identity through brands, and consumer use of global brands as quality signals provides a distinct competitive advantage to global brands in both developed and developing countries.     

Plant Size,Nationality, and Ownership Change

This paper asks whether the motivations behind mergers manifest themselves in different ways across small versus large plants, and between foreign- and domestic-owned plants. The sample consists of all the manufacturing plants in Canada between 1973 and 1999 and is divided into size quartiles by industry and grouped into foreign- and domestic-owned producers. We find that characteristics that are postulated to be associated with the type of synergy upon which ownership changes rely are found to be important factors leading to plant ownership changes across most size classes. However, the importance of synergies increases across size classes in domestic plants. Foreign-owned plants are more likely to experience control changes than domestic plants across all size classes. These differences are closely related to the characteristics possessed by foreign plants that offer takeover synergies. There is also evidence of a managerial failure motive for mergers in the foreign sector that is not found in the domestic sector.     

The role of consumer knowledge,experience,and heterogeneity in fish consumption: Policy lessons from Japan

Fish supply worldwide has increased significantly in recent decades, driven by the growing demand for food in developing economies, especially Asia. Many developed countries, including Japan, have implemented health policies that promote fish consumption. Despite efforts to encourage consumers to purchase fish, Japan has not achieved satisfactory results due to competition from cheap livestock products. The purpose of this study is to understand how consumers compare fish to other protein sources and how different consumer attributes influence the purchase frequency of fish. We used factor analysis to create a perceptual map of consumers' evaluations concerning protein sources, and a Bayesian hierarchical model incorporating individual heterogeneity to model purchase frequency. Our results show that Japanese consumers place great importance on availability when evaluating protein sources, and that fish is considered less available than other livestock products. In addition, Japanese consumers still prefer wild fish to farmed fish in terms of quality. Individual consumer attributes, such as age, household structure, and eating habits, were found to influence the decision to purchase fish. Consumers’ first-hand fish-related experience is found to be an important determinant of fish consumption. However, the effect of their knowledge identified in the conventional model was not detected in the Bayesian model. These results suggest that experiences allowing consumers to feel closer to fish are more effective than exposure to excessive information campaigns. Using lessons from Japan, this research could aid policymakers and suppliers of fish products to fashion appropriate and effective strategies for encouraging greater fish consumption.     

The financial determinants of corporate cash holdings: Evidence from some emerging markets

This paper investigates corporate cash holdings in developing countries. In particular, we look into the effect of capital structure and dividend policy on cash holdings in Brazil, Russia, India, and China and compare our results with a control sample from the US and the UK. Our sample contains 1992 firms across these countries for the period 2002–2008. We employ Instrumental Variables analysis to control for the endogeneity of the financial policies (cash holdings, capital structure, and dividend policy). Our results show some evidence that capital structure and dividend policy affect cash holdings. There are similarities between developed and developing countries on the factors determining corporate cash holdings. The results of our cross-country model provide evidence that capital structure, dividend policy, and firm size are important factors in determining cash holdings. Finally, we show that firms operating in countries with low shareholder protection hold more cash.     

Does Regulation in Credit,Labour and Business Matter for Bank Performance in the EU-10 Economies?

Cost efficiency scores for banks in ten new EU member countries of Central and Eastern Europe are estimated using a parametric approach (data envelopment analysis) for the period prior to and immediately following their accession (2000–2010). These are then used in both fixed effects and dynamic panels to estimate the impact of regulation on bank specific efficiency in the transition economies of the EU. Using the Fraser Index of Economic Freedom (Gwartney, Hall, and Lawson 2012) we find that, among all the indices of economic freedom, the composite regulation index that includes regulation in credit, labour and business has more importance for the banking sector as results suggest a positive and statistically significant impact on bank efficiency. By decomposing the regulation index into its three components (credit, business and labour regulation) we find that strict labour regulation is associated with lower bank cost efficiency while certain aspects of credit regulation such as foreign ownership and competition as well as private ownership are significantly associated with improved efficiency. The dynamic panel vector autoregression (VAR) results using impulse response functions and variance decomposition further support the validity of these results. These findings are valuable for both academics and policy makers in their attempts to understand the drivers of bank efficiency.     

The investigation on dimensions of e-satisfaction for online shoes retailing

Purpose—Online retailing has become a standard component in companies' multi-channel structure. This trend also involves an increasing number of experience attribute dominated products, which traditionally rely on brick-and-mortar retailers. These manufacturers have started to open their own online retail stores. This study identifies the key determinants of e-satisfaction at different stages of shoes online shopping process.Design/methodology/approach—We collect consumers' reviews about their online shopping experiences from online review websites. We use both qualitative and quantitative approaches to analyze the dataset, and investigate the complete process of consumers' e-tailing experiences.Findings—this research identifies the two key factors driving e-satisfaction of purchasing experience attribute dominated products online: product selection and customer service. In particular, our findings show that product selection is critical for e-satisfaction in the pre-purchase stage, and that customer service is more important in the post-purchase stage. Lastly, the study finds that manufacturers' websites often receive more negative reviews because of their poor service recovery strategies in the post-purchase period.Research limitations/implications—This study emphasizes the importance of adopting a dynamic approach by considering various stages of the consumer's online shopping experience. This study focuses on one specific experience good; the shoe industry.Practical implications—The results of this study are invaluable to firms interested in providing experience attribute dominated products online. Our findings indicate that product selection and especially post-purchase service are critical for a successful e-tailing.Originality/value—This paper emphasizes the importance of taking a dynamic view to investigate consumer's e-tailing experience. We adopt both qualitative and quantitative approaches in our study.     

Corporate Social Responsibility,Ownership Structure,and Political Interference: Evidence from China

Prior research suggests that ownership structure is associated to corporate social responsibility (CSR) in developed countries. This article examines whether and how ownership structure affects CSR in emerging markets using Chinese firms’ social responsibility ranking. Our empirical evidences show that for non-state-owned firms, corporate ownership dispersion is positively associated to CSR. However, for state-owned firms, whose controlling shareholder is the state, this relation is reversed. We attribute the reversed relationship to political interferences and further test this hypothesis by demonstrating that regional economic development is negatively related to CSR for state-owned firms due to decreased political interference in more developed areas. This study is the first to directly examine the relationship between the dispersion of corporate ownership and CSR in emerging markets, and our results depict that it is important to consider ownership type in assessing CSR in emerging market where state ownership is still prevalent such as China. The results also reveal that firm size, profitability, employee power, leverage, and growth opportunity affect CSR in China.     

Multinational Enterprises’ Entry Mode Strategies in Syria and Jordan: The Impact of Ownership Advantages

This study addresses the issue of ownership advantages affecting multinational enterprises’ (MNEs) entry mode strategies in developing countries. Although a few studies have focused on such effects, very little attention has been devoted to the ownership advantages generated from the institutional environment of MNEs’ home countries. To bridge this gap, this study concentrates on three types of ownership advantages: intangible asset advantages (IAA), advantages of common governance (ACG), and home‐country‐specific advantages (HCSA). Using a sample of 303 foreign affiliates, this study empirically examines the choice of MNEs between a wholly owned subsidiary (WOS) and a joint venture (JV). The data were collected from senior executives of MNEs’ subsidiaries operating in Syria and Jordan. The findings of this study reveal that MNEs’ choice of entry mode strategies is significantly influenced by intangible asset advantages, advantages of common governance, and home‐country‐specific advantages. Hence, senior executives perceiving an increased importance of these assets will opt for a WOS rather than a JV when entering a new market in the Middle East. © 2015 Wiley Periodicals, Inc.