Industry risk taking and risk-taking strategy of born-global firms

2019 ◽  
Vol 12 (1) ◽  
pp. 1-21
Author(s):  
Jing Huang ◽  
Linyu Liu ◽  
Ren Lu
Keyword(s):  
Risk Taking ◽  
Design Methodology ◽  
Fixed Effect Model ◽  
Born Global ◽  
Content Type ◽  
Related Variety ◽  
Effect Model ◽  
Industry Risk ◽  
The Relationship ◽  
Born Global Firms

Purpose The purpose of this paper is to study the relationship between industry risk taking and risk-taking strategy of born-global firms (BGs), and how industry-related variety moderates that relationship. Design/methodology/approach The authors apply fixed effect model to analyze 26,499 observations on 10,508 BGs in 276 Chinese cities. Findings The authors find that industry risk taking positively influences risk-taking strategy of BGs, and industry-related variety positively moderates such relationship. Originality/value The findings reveal how BGs formulate their risk-taking strategy given the dilemma of risk nature and hurdles in firm establishment and rapid internationalization. This paper extends understanding on BGs’ strategy making, supplements the theoretical framework on BGs with an integrated viewpoint containing “regional–industry–firm” levels and contributes to the industry variety argument.

Institutional effect on born global firms in China: the role of Sun Tzu’s The Art of War strategies

2016 ◽  
Vol 10 (1) ◽  
pp. 1-19 ◽  
Author(s):  
Man Zhang ◽  
Qian Gao ◽  
Jane V. Wheeler ◽  
Jungsook Kwon
Keyword(s):  
Emerging Markets ◽  
Institutional Environment ◽  
Critical Role ◽  
Born Global ◽  
Internationalization Process ◽  
Content Type ◽  
International Performance ◽  
The Relationship ◽  
Born Global Firms

Purpose – This paper aims to investigate the role of Sun Tzu’s significant strategies on the relationship between the institutional environment and international performance of Chinese born global firms, a type of small- and medium-sized enterprise (SME) characterized by the company’s limited resources and its early efforts to internationalize. Design/methodology/approach – The methodology is based on a multi-case analysis of interviews conducted with four chosen born global firms, coupled with public database and Web site searches. Through the use of qualitative methods, propositions were developed. Findings – This paper provides insights regarding how the institutional environment, both formal and informal, has a strong positive relationship with born global firm’s international performance. Moreover, Sun Tzu’s significant strategies play a critical role in the internationalization process of born global firms in emerging markets. Originality/value – Although existing studies discuss the application of Eastern philosophical strategies adopted by firms in emerging markets, to the best of our knowledge, this is one of the earliest studies which evaluates the moderation effect of Sun Tzu’s significant strategies on the relationship between institutional environment and business performance. The paper contributes to scholarly discourse on the influencing factors of born global firm’s internationalization process. It also has practical relevance to international entrepreneurs and SMEs from emerging markets.

Housing price and enterprise financing: does mortgage effect exist?

2019 ◽  
Vol 9 (1) ◽  
pp. 137-152 ◽  
Author(s):  
Shujing Li ◽  
Nan Gao
Keyword(s):  
Financial Development ◽  
Design Methodology ◽  
Empirical Test ◽  
Housing Prices ◽  
Housing Price ◽  
Fixed Effect Model ◽  
Content Type ◽  
Empirical Results ◽  
Effect Model ◽  
High Level

Purpose The purpose of this paper is to explore the influence of the rise in housing prices on enterprise financing and also the sustainability and heterogeneity of this effect. Design/methodology/approach Empirical test, panel data, fixed-effect model, IV and 2SLS were used in this paper. Findings The empirical results indicate that the mortgage effect does exist, and the authors further analyze the heterogeneity of this effect by dividing the sample based on the degree of financial development and property rights; the empirical results reveal that the mortgage effect is significantly higher in places with the high level of financial development. Besides, compared to the SOE enterprise, the mortgage effect has more influence on non-SOE companies. Research limitations/implications The results indicate that the mortgage effect should be considered when regulating housing market, and in order to improve the financing capability of company, its profitability and financial market efficiency should be emphasized. Originality/value This paper not only confirms the existence of the mortgage effect, but also explores its sustainability and heterogeneity, which reveals the risk and bubble in the effect of house market on enterprise financing, and enlightens how to promote financing ability of company.

scholarly journals Advancing the entrepreneurial orientation construct: the role of passion and perseverance

2016 ◽  
Vol 26 (4) ◽  
pp. 446-471 ◽  
Author(s):  
Stephan Gerschewski ◽  
Valerie J. Lindsay ◽  
Elizabeth Rose
Keyword(s):  
Risk Taking ◽  
Entrepreneurial Orientation ◽  
Empirical Support ◽  
Research Approach ◽  
Born Global ◽  
Born Globals ◽  
Content Type ◽  
Depth Interviews ◽  
Born Global Firms

Purpose The purpose of this paper is to examine how entrepreneurial orientation (EO) is manifested in the context of born global firms. Specifically, the authors investigate the extent to which the EO dimensions of the influential Miller/Covin & Slevin scale are demonstrated in born globals. In addition, following calls in the literature, some as-yet unrecognised dimensions of EO in born globals are examined. Design/methodology/approach The authors use a qualitative research approach by conducting semi-structured, in-depth interviews with eight born global firms from New Zealand and Australia. Findings The authors find that the EO dimensions of proactiveness and innovativeness are strongly prevalent in these firms. In contrast to the extant literature, the results also indicate that these born global firms generally display a relatively low level of risk-taking. The authors find strong empirical support for two additional emerging dimensions of EO: passion and perseverance. Originality/value The study provides two key contributions to the area of international entrepreneurship by investigating how EO is prevalent in the context of born globals and by proposing the new dimensions of passion and perseverance.

Bank regulatory capital and liquidity creation: evidence from BRICS countries

2018 ◽  
Vol 13 (1) ◽  
pp. 218-230
Author(s):  
Muhammad Umar ◽  
Gang Sun ◽  
Khurram Shahzad ◽  
Zia-ur-Rehman Rao
Keyword(s):  
Emerging Economies ◽  
Risk Taking ◽  
Design Methodology ◽  
Econometric Model ◽  
Bank Capital ◽  
Least Squares Regression ◽  
Regulatory Capital ◽  
Content Type ◽  
Brics Countries ◽  
The Relationship

Purpose The purpose of this paper is to explore the relationship between bank regulatory capital and liquidity creation in banks of BIRCS countries. Design/methodology/approach Data from all publicly listed banks of BRICS nations for the period 2003-2014 have been collected and analyzed. Two-stage least-squares regression has been used to control endogeneity. The econometric model includes different control variables that have been selected based on the extant literature. Findings Increase in bank capital negatively affects bank liquidity creation which implies that “financial fragility-crowding out” hypothesis holds for banks of BRICS countries. Originality/value This study provides the evidence of the inverse relationship between bank regulatory capital and liquidity creation from emerging economies. The findings show that there is a trade-off between curtailing bank risk taking and liquidity creation. Therefore, the regulators must formulate policies to strike a balance between the two.

Empirical evidence on disclosure and risk-taking of banks in Ghana

2016 ◽  
Vol 24 (2) ◽  
pp. 197-212 ◽  
Author(s):  
Lydia Kuranchie-Pong ◽  
Godfred Alufa Bokpin ◽  
Charles Andoh
Keyword(s):  
Empirical Evidence ◽  
Risk Taking ◽  
Design Methodology ◽  
Z Score ◽  
Total Risk ◽  
Treasury Bill ◽  
Content Type ◽  
Loan Losses ◽  
The Relationship ◽  
Insight Into

Purpose This paper aims to empirically examine the relationship between disclosure and risk-taking of banks in Ghana. The study also aims to gain an insight into the general risk-taking behaviour of banks in Ghana for the period 2007-2011. Design/methodology/approach The study used panel regression model and relate risk-taking to disclosure, controlling for bank size, profitability, liquidity and treasury bill rate. Disclosure scores from a disclosure index are used as a measure of disclosure, likewise Z-score as a measure of total risk. Also, the ratio of provisions for loan losses to gross loans by each bank for each year was used to examine the general risk-taking behaviour of Ghanaian banks. Findings The study revealed that the election year and the immediate subsequent year are characterized by an increase in non-performing loans. Greater disclosure is associated with more risk-taking and vice versa. This implies that market discipline is not effective in Ghana. Treasury bill rate, profitability and liquidity were found to be economically meaningful and statistically significant in influencing risk-taking of banks in Ghana. Originality/value As there are relatively few studies conducted in this area, specifically among banks in Ghana, this study will broaden the scope of the literature on disclosure and risk-taking by providing empirical evidence.

Advertising and promotions budgeting and the role of risk

2009 ◽  
Vol 43 (11/12) ◽  
pp. 1457-1476 ◽  
Author(s):  
Douglas West ◽  
Gerard P. Prendergast
Keyword(s):  
Risk Taking ◽  
Design Methodology ◽  
Measurement Techniques ◽  
Risk Process ◽  
Cultural Norms ◽  
Content Type ◽  
The Relationship ◽  
Advertising And Promotion ◽  
And Task

PurposeThis study aims to look at the conventional wisdom with regards to budgeting methods, processes, and sophistication in light of recent macro work relating budgetary approaches to risk‐taking.Design/methodology/approachBased on a survey of UK advertisers and personal interviews, current advertising and promotions budgeting methods and processes are summarized. A series of hypotheses relating risk, process and experience to advertising and promotions budgeting sophistication were tested.FindingsUK advertisers were found to use a variety of budgeting methods (two methods on average per company). Judgmental methods dominate, especially the “what is affordable” method, but at the same time more sophisticated methods like objective and task and measurement techniques (in particular return on investment) were solidly represented. The relationship between budgeting sophistication and risk was investigated, the premise being that risk and budgeting sophistication are inversely related, as well as budgetary processes and marketing experience.Research limitations/implicationsConsiderable insight is provided into the methods and processes being used. It is concluded that the explanation as to why firms use sophisticated or unsophisticated methods for setting their advertising and promotion budgets is largely related to organizational culture.Originality/valueJust over 1.5 percent of the UK's gross domestic product is spent on advertising and promotions (£19 billion). The study suggested that the primary reason for the lack of consensus on budgetary sophistication is that stakeholders involved with budgeting are far less concerned with specific methods than dealing with cultural norms, personalities, access to supporting data and policies and practices.

Regional patent activity in Russia: does level of risks make a difference?

2018 ◽  
Vol 28 (2) ◽  
pp. 136-154 ◽  
Author(s):  
Natalia Ermasova ◽  
Olumide Ijose ◽  
Sergey Ermasov
Keyword(s):  
Design Methodology ◽  
Negative Impact ◽  
Random Effect ◽  
Random Effect Model ◽  
Patent Activity ◽  
Content Type ◽  
Empirical Results ◽  
Effect Model ◽  
The One ◽  
The Relationship

Purpose The purpose of this paper is to explore empirically the linkages among level of economic, managerial, financial, criminal risks and patent activity in Russia. This paper examines the relationship between the economic, managerial, financial and criminal regional risks ratings, on the one hand, and patent activity, as measured by regional patent applications for inventions, on the other. Design/methodology/approach A random effect model was performed for a data sample of 83 regions, covering the period 2006-2010 in Russia. Findings The empirical results show that increased levels of regional economic risks are significantly associated with decrease in patent activity in Russia. Originality/value This study fills a gap within the literature and offers a unique analysis of regional risks and their impact on patent activity. The empirical results showed that economic risk ratings have had considerable negative impact on the patent activities on regional level in Russia.

scholarly journals Born globals and business incubators: a case analysis

2018 ◽  
Vol 26 (3) ◽  
pp. 490-517 ◽  
Author(s):  
Nadzeya Kuryan ◽  
Mohammad Saud Khan ◽  
Veronika Gustafsson
Keyword(s):  
Design Methodology ◽  
Case Analysis ◽  
Born Global ◽  
Born Globals ◽  
Effective Management ◽  
Business Incubators ◽  
Content Type ◽  
Business Support ◽  
Born Global Firms

PurposeThis paper aims to analyze born globals and business incubators from an empirical standpoint. Particularly, the role of business incubators in the emergence and development of born global firms is focused, thereby outlining the significance of incubator influence on rapid internationalization.Design/methodology/approachBased on extant literature on born globals, business incubators and their interrelationship that nurtures internationalization, a theoretical model is developed and empirically tested to analyze potential born globals residing in business incubators.FindingsDue to services provided, such as infrastructure, business support and networking, business incubators create a favorable environment for rapid internationalization of their tenants. However, the initiative to go international comes from the incubatees, and the motivating role of business incubators in this process is fairly insignificant.Originality/valueThe incubator-incubation phenomenon is notably under-researched, with most of the literature focusing on “incubator topics.” This relationship is extremely important to understand to choose appropriate political measures and orchestrate effective management of business incubators.

Familial altruism and reputation risk: evidence from China

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hanqing “Chevy” Fang ◽  
Yulin Shi ◽  
Zhenyu Wu
Keyword(s):  
Developing Countries ◽  
Earnings Management ◽  
Risk Taking ◽  
Design Methodology ◽  
Family Firms ◽  
Family Members ◽  
Content Type ◽  
Reputation Risk ◽  
The Relationship ◽  
Risk Taking Behaviors

PurposeThe authors study the effects of altruism and intention for succession on family firm's reputation risk-taking behaviors in Chinese publicly listed companies.Design/methodology/approachThe authors use earnings management as a proxy for reputation risk in family firms, and hand-collected relationship between family members to measure the closeness of incumbent family members and their potential successors as a proxy for the altruistic degree.FindingsResults show that, in developing countries like China, familial altruism in family firms with succession plans, which does not reduce the practice of earnings management, should be considered by practitioners while detecting it.Originality/valueThe hand collected data are very unique; the authors have focused on the relationship between incumbents and successors and the authors define their closeness by using genes shared between them.

Does the Shariah committee influence risk-taking and performance of Islamic banks in Malaysia?

2020 ◽  
Vol 11 (9) ◽  
pp. 1739-1755
Author(s):  
Mansor Isa ◽  
Siew-Peng Lee
Keyword(s):  
Panel Data ◽  
Risk Taking ◽  
Design Methodology ◽  
Bank Risk ◽  
Islamic Banks ◽  
Content Type ◽  
Banking Business ◽  
And Performance ◽  
The Relationship ◽  
Practical Implications

Purpose This study aims to investigate how the Shariah committee in Islamic banks affects banks’ risk-taking behaviour and performance. Design/methodology/approach The sample is based on a panel data of 15 Islamic banks in Malaysia over the period 2007–2016. The generalised least squares random-effects method is used to study the relationship between the Shariah committee and bank risk-taking and performance. Findings The findings suggest that the number of committee members with Shariah qualification and the number of reputable members are negatively related to risk-taking while members with finance/banking qualifications are positively related. On the financial performance, evidence of two variables that are positively related to performance, namely, members with finance/banking qualification and reputable members was found. Female participation is weakly negatively related to risk-taking but unrelated to performance. Other variables, such as committee size, years of experience and frequency of meetings, are found to be unrelated to risk-taking and performance. Practical implications The paper points to two implications. First, the roles and functions of the Shariah committee should be revised to emphasise Shariah-compliance, as well as the business aspects of the banking operations. Second, the regulators should also look at the composition of the Shariah committee to ensure a diversity of expertise related to the banking business. Originality/value This paper extends the scope and coverage of previous studies by investigating the attributes of the Shariah committee, which could be important in influencing the risk-taking behaviour and performance of banks.

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