Determinants of innovation outputs in developing countries

2015 ◽  
Vol 42 (2) ◽  
pp. 237-260 ◽  
Author(s):  
Reza Ghazal ◽  
Muhamed Zulkhibri
Keyword(s):  
Developing Countries ◽  
Panel Data ◽  
Negative Binomial ◽  
Developing Economies ◽  
Content Type ◽  
Innovation Activities ◽  
Fertile Ground ◽  
Main Determinants ◽  
The Impact

Purpose – The purpose of this paper is to examine the determinants of innovation outputs proxied by number of patent applications, trademarks and industrial designs in developing countries. Design/methodology/approach – The paper employs a panel data and Negative Binomial method to analyse the main determinants affecting the innovation outputs. Findings – The results implicitly suggest that providing a fertile ground to attract more foreign direct investment (FDI) can lead to much better innovation outputs. The study also strongly supports the role of institutions and governance for increasing innovation activities in developing economies as indicated by positive impacts of governance factors in the model. However, the impact of economic freedom indicators on improving innovation outputs is mixed. Originality/value – This paper contributes to the existing literature in two ways: it examines the effect of FDI and research and development on innovation of selected developing countries; and the study uses a panel data approach to increase the accuracy of the results through exploiting the significant variations of innovation outputs across countries, while controlling for a larger number of innovation outputs and product determinants. To the authors knowledge, this is the first empirical study on the behaviour of innovation outputs for developing countries.

scholarly journals Franchising and country development: evidence from 49 countries

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Cintya Lanchimba ◽  
Hugo Porras ◽  
Yasmin Salazar ◽  
Josef Windsperger
Keyword(s):  
Developing Countries ◽  
Economic Development ◽  
Developing Economies ◽  
Positive Impact ◽  
Spillover Effects ◽  
Content Type ◽  
Infrastructural Development ◽  
Emerging And Developing Countries ◽  
The Impact

PurposeAlthough previous research has examined the role of franchising for the economic development of countries, no empirical study to date has investigated the importance of franchising for social, infrastructural, and institutional development. The authors address this research gap by applying research results from the field of sustainable entrepreneurship and highlight that franchising has a positive impact on economic, social, institutional and infrastructural development.Design/methodology/approachThis study uses a fixed-effects model on a panel dataset for 2006–2015 from 49 countries to test the hypothesis that franchising positively influences various dimensions of country development such as economic social institutional and infrastructural development.FindingsThe findings highlight that franchising has a positive impact on the economic, social, infrastructural, and institutional development of a country. Specifically, the results show that the earlier and the more franchising systems enter a country, the stronger the positive impact of franchising on the country's economic, social, institutional, and infrastructural development.Research limitations/implicationsThis study has several limitations that provide directions for further research. First, the empirical investigation is limited by the characteristics of the data, which are composed of information from 49 countries (covering a period of 10 years). Because franchising is not recognized as a form of entrepreneurial governance in many emerging and developing countries, the available information is mainly provided by the franchise associations in the various countries. Hence, there is a need to collect additional data in each country and to include additional countries. Second, although the authors included developed and developing countries in the analysis, the authors could not differentiate between developed and developing countries when testing the hypotheses, because the database was not sufficiently complete. Third, future studies should analyze the causality issue between franchising and development more closely. The role of franchising in development may be changing depending on different unobserved country factors, economic sector characteristics, or development stages.Practical implicationsWhat are the practical implications of this study for the role of franchising in the development of emerging and developing economies? Because public policy in emerging and developing countries suffers from a lack of financial resources to improve the social, infrastructural and institutional environment, entrepreneurs, such as franchisors who expand into these countries, play an important role for these countries' development. In addition to their entrepreneurial role of exploring and exploiting profit opportunities, they are social, institutional, and political entrepreneurs who may positively influence country development (Schaltegger and Wagner, 2011; Shepard and Patzelt, 2011). Specifically, the findings highlight that countries with an older franchise sector (more years of franchise experience) may realize first-mover advantages and hence larger positive spillover effects on their economic, social, institutional and infrastructural development than countries with a younger franchise sector. Hence, governments of emerging and developing countries have the opportunity and responsibility to reduce potential market entry barriers and provide additional incentives for franchise systems in order to trigger these positive spillover effects. The authors expect that the spillover effects from the franchise sector on the economic, institutional, social and infrastructural development of a country are stronger in emerging and developing countries than in developed countries.Originality/valuePrevious research has focused on the impact of franchising on the economic development of a country, such as its growth of gross domestic product (GDP), employment, business skills, innovation and technology transfer. This study extends the existing literature by going beyond the impact of franchising on economic development: the results show that franchising as an entrepreneurial activity offers opportunities for economic, social, institutional, and infrastructural development, all of which are particularly important for emerging and developing economies. The findings of this study contribute to the international franchise and development economics literature by offering a better understanding of the impact of franchising on country development.

Could CSR improve the financial performance of developing countries’ firms? Analyses of mediating effect of intangible resources

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mohamed Hamdoun ◽  
Mohamed Akli Achabou ◽  
Sihem Dekhili
Keyword(s):  
Developing Countries ◽  
Human Capital ◽  
Financial Performance ◽  
Competitive Advantage ◽  
Mediating Effect ◽  
Social Dimension ◽  
Content Type ◽  
Intangible Resources ◽  
The Impact

Purpose This paper aims to examine the link between corporate social responsibility (CSR) and financial performance in the context of developing countries. More specifically, the mediating role of a firm’s competitive advantage and intangible resources, namely, human capital and reputation are studied. Design/methodology/approach The study considered a sample of 100 Tunisian firms. The analysis makes use of the structural equation modelling method to explore the relationship between CSR and financial performance, by including mediator variables. Findings The results confirm that CSR has no significant direct effect on financial performance. In particular, they indicate that the social dimension of CSR has a negative impact on performance. However, CSR does have a positive impact on competitive advantage via the two intangible resources considered, human capital and company reputation. Research limitations/implications The research fills a gap that occurred in the previous literature. In effect, previous studies focussed only on the direct link between CSR and financial performance. In addition, it enriches the limited literature on CSR strategies in the context of developing countries. However, further studies should explore the opposite relationship, i.e. the impact of financial performance on CSR strategy. In addition, the authors believe that amongst other potential research avenues, it would be interesting to study the moderating role of the activity sector. Practical implications From a practical point of view, this study suggests new applications with respect to the link between CSR and financial performance. To enhance their company’s financial performance, managers need to ensure that intangible resources are managed efficiently. Originality/value The paper contributes to the literature by examining how a firm’s intangible resources mediate between CSR and competitive advantage and how competitive advantage mediates between intangible resources and financial performance. Second originality is related to the study of the link between CSR and the financial performance of business organisations in the context of a developing country.

The role of audit committees in mitigating earnings management: evidence from Jordan

2022 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Taha Almarayeh ◽  
Modar Abdullatif ◽  
Beatriz Aibar-Guzmán
Keyword(s):  
Developing Countries ◽  
Earnings Management ◽  
Audit Committee ◽  
Discretionary Accruals ◽  
Least Square ◽  
Audit Committees ◽  
Institutional Setting ◽  
Content Type ◽  
The Impact

PurposeThis study examines the relationship between audit committees (ACs) and earnings management (EM) in the developing country context of Jordan. In particular, it investigates whether audit committee attributes, including their size, independence, expertise and meetings, are able to restrict discretionary accruals as a proxy for EM.Design/methodology/approachThe generalized least square (GLS) regression was used to study the association between audit committee attributes and discretionary accruals, as a proxy of EM, for a sample of industrial firms listed on the Amman Stock Exchange (ASE) during the period 2012–2020. Data were obtained from the firms' annual reports.FindingsThe regression results indicate that audit committee independence is the only audit committee attribute that seems to improve the effectiveness of ACs, in that it is significantly associated with less EM, while other audit committee attributes that were tested do not show statistically significant associations.Research limitations/implicationsIn emerging markets, like Jordan, ACs may not be an efficient monitoring mechanism; therefore, it can be argued that the prediction made by the agency theory about the role of ACs in mitigating opportunistic EM activities does not necessarily apply to all contexts.Practical implicationsA better understanding of audit committee effectiveness in developing countries could help regulators in these countries assess the impact of planned corporate governance (CG) reforms and to better monitor and enhance the performance of ACs.Social implicationsIn a setting characterized by closely held companies, high power distance and low demand for high-quality CG mechanisms, this study contributes to understanding how this business system operates, and how improving CG mechanisms could be successful in such cultures.Originality/valueThis study investigates the under-researched relationship between audit committee characteristics and EM in developing countries. In so doing, it aims to provide new insights into this relationship within the developing context case of Jordan, including if and how the institutional setting influences this relationship.

The impact of firm resources on innovation

2018 ◽  
Vol 21 (4) ◽  
pp. 672-694 ◽  
Author(s):  
Irem Demirkan
Keyword(s):  
Negative Binomial ◽  
Network Size ◽  
Firm Level ◽  
Firm Innovation ◽  
Holistic View ◽  
Slack Resources ◽  
Content Type ◽  
External Resources ◽  
The Impact

PurposeThe purpose of this paper is to propose that the resources that a firm owns and has full control (firm-level resources) and resources that a firm access through direct connection with other firms (network-level resources) will impact firm innovation when effectively deployed by the firm. While previous research examined these factors separately, the author takes a holistic view and looks into their effects on innovation simultaneously. The author also introduces the moderating effects, i.e. the variables that can enhance firm innovation through their interaction with internal and external resources.Design/methodology/approachThe author tested the role of financial resources and slack resources in the form of cash slack and human slack at the firm level, and network size, network tie strength, and network diversity at the network level on the firm innovation. Using generalized negative binomial model with Huber-White procedure, the author analyzed 306 firms from the biotechnology industry over a span of 17 years.FindingsThe analysis suggests that cash slack impact innovation negatively. However, this link is moderated by firm size such that for large firms cash slack affects innovation positively. Network-level resources all positively impact innovation and have more economic impact on firm innovation than firm-level resources. Furthermore, although human slack negatively affects innovation, its interaction with network size enhances innovation.Originality/valueThe research makes important contributions to both strategic management and innovation literatures especially when, the author considers the role of firm-level slack in driving firm innovation. Previous research reported conflicting findings about the availability of slack resources and firm performance. The results showed that the relationship between slack resources and firm innovation is negative and significant, both for available slack and human slack. This finding parallels with previous research which reported that constraints such as lack of slack resources can actually facilitate innovation. The author also contributes to the literature by introducing boundary conditions which can enhance firm innovation through their interaction with firm-level internal and network-level external resources. In this respect, to the author’s knowledge, this is among the first studies to combine the slack literature focusing on firm-level resources with the literature on network-level resources.

Role of gender and corporate risk taking

2020 ◽  
Vol 20 (3) ◽  
pp. 383-399 ◽  
Author(s):  
Dene Hurley ◽  
Amod Choudhary
Keyword(s):  
Panel Data ◽  
Risk Taking ◽  
Financial Risk ◽  
Chief Financial Officers ◽  
Board Members ◽  
Content Type ◽  
Equity Ratio ◽  
Glass Cliff ◽  
The Impact

Purpose The purpose of this study is to examine the role of chief financial officers’ (CFOs’) gender in financial risk taking of 58 US companies along with the impact of having women board members. Design/methodology/approach Using a panel data of 58 selected S&P 500 companies during the period 2012-2016, this paper determines whether the gender of CFOs and having women board members play a role in risk-taking behavior of firms. Findings Firms led by female CFOs are smaller in size with lower net income and net revenue. The panel data analysis shows that the impact of female CFOs on firms’ financial risk is mixed, depending on risk measures used, whereas increasing female board members reduces that risk. Research limitations/implications The data used is limited to 58 S&P 500 companies, and two of the three risk-taking measures used in the study, specifically investment in property, plant and equipment (PPE) and debt/equity ratio, may not be applicable to some industries. Practical implications The findings provide mixed evidence of risk aversion by females in executive and leadership positions, depending on the measures used and the management responsibilities they undertake (CFO versus board member) with support for the glass cliff phenomenon in which females may be leading financially precarious organizations. Social implications Female CFOs are found to be leading relatively smaller and financially poor-performing firms compared with the male CFO-led firms, thereby giving support to the glass cliff arguments. Originality/value The paper examines the role of CFOs’ gender and board diversity in risk taking as measured by the investment in PPE, debt/equity ratio and stock return volatility.

A review of the role of HEI’s in developing academic entrepreneurship

2015 ◽  
Vol 7 (2) ◽  
pp. 168-188 ◽  
Author(s):  
Lalit Sharma
Keyword(s):  
Developing Economies ◽  
Methodological Approach ◽  
Entrepreneurship Education ◽  
Entrepreneurial Intentions ◽  
Knowledge Level ◽  
Entrepreneurial Education ◽  
Content Type ◽  
Ex Post ◽  
The Impact

Purpose – The prime purpose of the study is to assess the role of education in general and entrepreneurship education in particular in developing youth entrepreneurship in Uttarakhand State, India. The study also tested the methodology based on effectiveness and compared it with the traditional ex post method to find if there is any difference in results. Alternatively, the study also checked whether the students of developing economies are more likely to take up entrepreneurship as a career, which has strongly been contended by some of the recent studies. Design/methodology/approach – The role of education was assessed on two grounds: increase in general awareness and knowledge about entrepreneurship, and development of entrepreneurial intentions and inclination of students. A structured questionnaire was administered on 530 final-year students. The questionnaire tested the interest and intentions of students towards taking up entrepreneurship as a career and also evaluated the level of awareness and knowledge of entrepreneurship among the students. Cross-tabulation, mean values and t-test were used to analyse the results. Findings – The research confirmed that higher education institutions (HEIs) of Uttarakhand have not been very effective in building entrepreneurial awareness and knowledge level of students. Students who studied entrepreneurship subject showed a little better awareness and knowledge level of entrepreneurship, which was found to be statistically significant in comparison to their counterparts, but the mean scores indicated poor knowledge level. As the authors used an ex post method and method based on effectiveness of entrepreneurship education, the authors got two different results for impact of entrepreneurship education on entrepreneurial intentions. More appropriate one being that with the observed level of awareness and knowledge level of entrepreneurship (which was very low); the authors cannot possibly determine the actual impact of entrepreneurial education on entrepreneurial intentions. Practical implications – The research has direct implications for research scholars working in the field of determining the impact of entrepreneurship education on entrepreneurial intentions, entrepreneurship education institutions and also the policymakers. Originality/value – In comparison to most of the earlier studies done to find the impact of entrepreneurship education on entrepreneurial intentions, this study differs in its methodological approach and first of all evaluates the effectiveness and impact of entrepreneurial education in developing entrepreneurial awareness and knowledge of student. The author undertakes that if entrepreneurship education is ineffective in developing the desired level of awareness and knowledge of entrepreneurship, the actual effect of entrepreneurial education on entrepreneurial intentions cannot actually be determined and the authors may not be able to get accurate outcomes of such studies. To justify the stand, author compares the traditional ex post approach with the approach based on effectiveness of the programme and brings into light the difference in outcomes. The proposed approach rests on the premises that education must be absorbed and not just delivered to assess its impact.

Influences of technological attributes on sourcing of manufacturing technologies in developing countries

2019 ◽  
Vol 17 (4) ◽  
pp. 359-378
Author(s):  
Rony Cabrera ◽  
Domingo González
Keyword(s):  
Developing Countries ◽  
Manufacturing Sector ◽  
Manufacturing Firms ◽  
Manufacturing Technology ◽  
Content Type ◽  
Innovation Activities ◽  
External Sources ◽  
Technology Sourcing ◽  
Manufacturing Technologies ◽  
The Impact

Purpose As part of a new focus on a better balance of investment in innovation activities in developing countries, this study aims to understand the effects of technological attributes (technological complexity and type of technology) on manufacturing technology sourcing (whether firms choose either internal development or external sources). Design/methodology/approach Multiple-case studies were conducted in the Peruvian manufacturing sector. Findings The authors found that, across Peruvian manufacturing firms, they develop a certain manufacturing technology related to their capabilities. However, when the total cost of acquisition is lower than internal costs of developing technologies, they will choose external sources, regardless of their capabilities and complexity of the technology. In addition, analysis of the type of technology indicated that the pursuit of simultaneous exploration and exploitation occurs when firms use external sources rather than internal. Research limitations/implications This study has the limitation that data have been collected years after the decision-making process; the results are based solely on the authors’ analysis using the case of Peruvian industry, and they do not track the impact on the performance of manufacturing technology decisions. Practical implications The findings have important implications for technology managers of South American manufacturing firms that are decision makers in the sourcing of new manufacturing technologies. Originality/value The results of this study provide literature with insights into technology sourcing strategy in developing countries and the importance of progress in transitioning to technological innovation and catchup.

Investor reaction to R&D investment

2016 ◽  
Vol 8 (2) ◽  
pp. 133-147
Author(s):  
Xin Li ◽  
Tienan Wang
Keyword(s):  
Stock Price ◽  
New Product ◽  
Content Type ◽  
Innovation Activities ◽  
Development Capacity ◽  
The Impact ◽  
D Investment ◽  
Investor Reaction ◽  
Positive Effect

Purpose This paper aims to examine the impact of research and development (R&D) investment on firms’ stock price from the perspective of investors. Design/methodology/approach Building on signaling theory, the authors propose that R&D investment sends important signals to the investment community regarding future growth, which in turn impacts investor reaction to such investment. Findings Using a sample of listed pharmaceutical firms in China from 2007 to 2011, the authors find that R&D investment has a positive effect on firms’ stock price, indicating that investors have a positive reaction to R&D investment signals. Further, the authors find that the signaling role of new product announcements mediates this relationship between R&D investment and investor reaction. Originality/value The authors also find that the signaling role of development capacity (DC) has a moderating effect on the relationship between innovation activities (i.e. R&D investment and new product announcements) and investor reaction, such that DC strengthens the positive effect of R&D and new product announcements on investors.

The impact of violence on tourism to Rio de Janeiro

2020 ◽  
Vol 47 (4) ◽  
pp. 425-443 ◽  
Author(s):  
Gabriel Caldas Montes ◽  
Solimar de Pinho Bernabé
Keyword(s):  
Developing Countries ◽  
Panel Data ◽  
Peer Review ◽  
Rio De Janeiro ◽  
Developed Countries ◽  
The State ◽  
Urban Violence ◽  
Content Type ◽  
Tourism Potential ◽  
The Impact

PurposeRio de Janeiro has a high tourism potential, and it is the only Brazilian city among the 100 most visited in the world. However, the National Confederation of Commerce of Goods, Services and Tourism estimates that from the total loss of revenue from tourism activities of the State of Rio de Janeiro in 2017, approximately 29 percent of this loss can be attributed to increased violence in the State. Thus, this study aims to estimate the impact of violence on tourist arrivals to Rio de Janeiro.Design/methodology/approachThe analysis is based on a sample of tourist arrivals to Rio de Janeiro from 51 countries, for the period between 2003 and 2016. Violence is represented by violent deaths in the State of Rio de Janeiro as well as in the capital. The estimates are based on panel data methodology. This study reports fixed-effect estimates as well as dynamic panel data estimates obtained through S-GMM. The study runs regressions for the full sample and also for two other samples: one with tourists coming from developed countries and another with tourists from developing countries.FindingsThe results reveal that violence negatively impacts tourism to Rio, and it shows that tourists from developed countries are more affected by violence than tourists from developing countries. The findings indicate that for each violent death in the capital of Rio de Janeiro, almost four tourists from developed countries and approximately three tourists from developing countries quit going to Rio de Janeiro.Originality/valueThe paper is one of the few to investigate the impacts of urban violence on tourism. The paper provides two contributions. First, it addresses the effect of violent deaths on tourism, bringing evidence to a destination with a high tourism potential, but which suffers from urban violence. Second, the study is the first to investigate whether this relation is different for tourists from countries with distinct levels of development (and thus with different levels of violence).Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-09-2019-0590

Servitization impact on performance moderated by country development

2019 ◽  
Vol 27 (1) ◽  
pp. 302-318 ◽  
Author(s):  
Renata Moreno ◽  
Leonardo Marques ◽  
Rebecca Arkader
Keyword(s):  
Developing Countries ◽  
Firm Performance ◽  
Social Impact ◽  
Developing Economies ◽  
Developed Countries ◽  
Content Type ◽  
Advanced Economies ◽  
Medium Level ◽  
And Performance ◽  
The Impact

Purpose In recent years, “servitization” has been studied extensively; however, as studies of the impact of servitization on firm performance offer mixed results, the conditions under which the relationship between servitization and performance becomes more significant are contested in the literature. These mixed results have led to the term “service paradox.” The paper aims to discuss these issues. Design/methodology/approach This study investigates servitization in the assembly industry based on a multi-country survey covering 539 industry plants in 22 countries. Findings The study contributes to the research on servitization by adding a contextual perspective to this relationship, taking into account level of development of the country in which a firm is located. Besides confirming the correlation between the servitization and performance, our study unveils a counter-intuitive result: a medium level of development of the country in which a firm is based corresponds to a stronger relationship between servitization and firm performance, whereas higher levels of development seem to diminish the increase in performance. Social implications This study balances out the focus in servitization on advanced economies and help to unveil its benefits in developing countries. Fostering servitization in developing economies can lead to social impact resulting from job shifts from manufacturing to service and the correlated implications for workers’ training and higher motivation experienced in service-based jobs. Originality/value Our study unpacks the “service paradox” and indicates that industry plants in developing countries can still harness the benefits of being first-movers, whereas, in developed countries, servitization may have become an order qualifier rather than a factor of differentiation.

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