CEO Stock-Based Pay, Home-Country Risk, and Foreign Firms' Capital Acquisition in the US Market

2010 ◽  
Vol 18 (6) ◽  
pp. 496-510 ◽  
Author(s):  
Mason A. Carpenter ◽  
Daniel C. Indro ◽  
Stewart R. Miller ◽  
Malika Richards
Keyword(s):  
Home Country ◽  
Country Risk ◽  
Foreign Firms ◽  
The Us ◽  
Capital Acquisition

scholarly journals Chinese Service Multinationals: The Degree of Internationalization and Performance

2021 ◽  
Author(s):  
Ziyi Wei ◽  
Quyen T. K. Nguyen
Keyword(s):  
Financial Performance ◽  
Multinational Enterprises ◽  
Home Country ◽  
Academic Research ◽  
Brand Names ◽  
Theoretical Development ◽  
Superior Performance ◽  
Foreign Firms ◽  
Service Firms ◽  
Degree Of Internationalization

AbstractWe investigate the degree of internationalization of Chinese service multinational enterprises (MNEs) and their performance relative to global peers operating in the same industries, using the benchmarking method with the industry financial data. Our theoretical development is based upon Verbeke and Forootan (2012)’s framework, grounded in “new” internalization theory, arguing that an MNE’s financial performance is fundamentally determined by its firm-specific advantages (FSAs). Here FSAs include not only conventional strengths in R&D and brand names, but also the recombination capabilities, which is a higher-order FSA. We theorize that Chinese service MNEs develop FSAs, which are built upon home country-specific advantages (CSAs) and thus their FSAs are home country-bound in nature. They have not yet been able to develop advanced management capabilities through recombination with host CSAs. We empirically examine the largest 500 Chinese service firms. We find that only 23 Chinese service firms are true MNEs, whereas the majority of them are purely domestic firms. The financial performance of Chinese service MNEs is poor relative to global peers. They internationalize mainly through acquisitions of foreign firms, which help them increase their foreign sales, but they are not able to achieve superior performance in overseas operations. We discuss the strategic implications of our findings for managers, public policy makers, and academic research.

scholarly journals How International Political Conflict Hurts Country Image and further Influences Consumers’ Purchase Intention

2018 ◽  
Vol 11 (2) ◽  
pp. 95
Author(s):  
Mary Kang ◽  
Sarah Kim ◽  
Gukseong Lee
Keyword(s):  
Purchase Intention ◽  
Home Country ◽  
Underlying Mechanism ◽  
Political Conflict ◽  
Purchase Intentions ◽  
Foreign Firms ◽  
Country Image ◽  
Research Model ◽  
Missile Defense ◽  
The Relationship

Recently, South Korea’s decision to deploy an advanced U.S. missile defense system has drawn neighboring China’s strong protests. Amid this political tension between both countries, the purpose of this study is to explore the relationship between this specific political conflict and consumers’ purchase intention. Based on previous literature, this study suggests a research model that defines the relationship between international political conflict, country image (i.e., affective country image and cognitive country image) and purchase intention. Proposed hypotheses suggest that international political conflict between foreign firms’ host and home countries is negatively associated with consumers’ purchase intention toward foreign firms’ products in the host country by hurting cognitive and affective image of the home country. This study contributes to understanding the underlying mechanism on how international political conflict influences consumers’ purchase intentions.

Cournot-Bertrand competition: a revisit of strategic trade policy in the third-market model

2016 ◽  
Vol 43 (3) ◽  
pp. 475-487 ◽  
Author(s):  
Shoou-Rong Tsai ◽  
Pan-Long Tsai ◽  
Yungho Weng
Keyword(s):  
Optimal Policy ◽  
Home Country ◽  
Export Subsidy ◽  
Stackelberg Equilibrium ◽  
Market Model ◽  
Foreign Firms ◽  
Domestic Firm ◽  
Model Framework ◽  
Content Type ◽  
Strategic Variable

Purpose – The purpose of this paper is to discuss the optimal policy settings of the home government for any combination of strategic variables adopted by home and foreign firms under Brander and Spencer’s third-market model framework. Design/methodology/approach – This paper follows all the assumptions of Brander and Spencer with only two modifications: firms produce differentiated products, and firms choose different strategic variables. A two-stage game is set and the subgame-perfect Nash equilibrium is deduced following backward induction. Findings – The authors arrive at a general, simple rule to determine the optimal policy of the home government for any combination of strategic variables: regardless of the strategic variable of the domestic firm, the optimal policy of the home country is an export subsidy (tax) as long as the foreign firm’s strategic variable is output (price). The optimal subsidy or tax of the home country is shown to move the equilibrium to the Stackelberg equilibrium where the domestic firm behaves as the leader while the foreign firm behaves as a follower under free trade. With appropriate interpretations and a suitable caveat, the above results still hold in the case with multiple foreign firms which may choose different strategic variables. Originality/value – This paper fills the gap in the literature, and provides some more general results not easily detected in the original model of Brander and Spencer or Eaton and Grossman.

scholarly journals Rethinking the Literature on the Performance of Chinese Multinational Enterprises

2016 ◽  
Vol 12 (2) ◽  
pp. 269-302 ◽  
Author(s):  
Alan M. Rugman ◽  
Quyen T. K. Nguyen ◽  
Ziyi Wei
Keyword(s):  
Multinational Enterprises ◽  
Home Country ◽  
Academic Research ◽  
Manufacturing Firms ◽  
Superior Performance ◽  
Foreign Firms ◽  
Chinese Firms ◽  
Theoretical Perspectives ◽  
Overseas Operations ◽  
Chinese Multinational Enterprises

ABSTRACTWe synthesize the literature on Chinese multinational enterprises (MNEs) and find that much of the prior research is based on as few as a dozen case studies of Chinese firms. They are so case-specific that it has led to a misplaced call for new theories to explain Chinese firms’ internationalization. In an attempt to better relate theory with empirical evidence, we examine the largest 500 Chinese manufacturing firms. We aim to find out the number of Chinese manufacturing firms to be true MNEs by definition, and to examine their financial performance relative to global peers using the financial benchmarking method. We develop our theoretical perspectives from new internalization theory. We find that there are only 49 Chinese manufacturing firms to be true MNEs, whereas the rest are purely domestic firms. Their performance is poor relative to global peers. Chinese MNEs have home country bound firm-specific advantages (FSAs), which are built upon home country-specific advantages (home CSAs). They have not yet developed advanced management capabilities through recombination with host CSAs. Essentially, they acquire foreign firms to increase their sales in domestic market, but they fail to be competitive internationally and to achieve superior performance in overseas operations. Our findings have important strategic implications for managers, public policy makers, and academic research.

scholarly journals FOREIGN INVESTORS AS SIGNPOSTS OF CHANGE?

Ekonomika ◽  
2009 ◽  
Vol 86 ◽  
pp. 89-105
Author(s):  
Camilla Jensen
Keyword(s):  
Regional Policy ◽  
Market Access ◽  
Home Country ◽  
Radical Change ◽  
Agglomeration Economies ◽  
Foreign Firms ◽  
Conditional Logit Model ◽  
Foreign Investors ◽  
Conditional Logit ◽  
Specific Factors

The new market economies in Eastern Europe give a unique opportunity to study how agglomeration occurs due to the shift from a planner- constructed to a firm-driven economy. This paper it is investigated how foreign direct investment affects the existing economic geography. How are these changes taking place within the existing landscape of agglomerations inherited from socialism? Do foreign investors sustain existing patterns of agglomeration or are they signposts of change? A conditional logit model is implemented on a representative dataset combining the firm and regionallevel. Controls are made for region- and firm-specific factors such as market access, pre-existing industrial concentrations, regional policy and firm size. The results suggest that foreign investors are agents of both gradual and radical change in a new market economy such as Poland. With the exception of the capital region of Warsaw, past agglomerations are on the reverse and new ones are emerging; however, industrial inertia is quite strong outside Warsaw. Results also show that agglomeration economies in the make are significantly affected by cognitive distance. Foreign firms are more likely to go where other proximate peers (in terms of home country, industry and both) are going or have already gone.

scholarly journals Methodology of calculating risk premiums in the environment of the Czech Republic and its comparison with Damodaran

2021 ◽  
Vol 91 ◽  
pp. 01045
Author(s):  
Jiri Kucera ◽  
Lenka Maskova
Keyword(s):  
Czech Republic ◽  
Capital Market ◽  
Risk Premium ◽  
Country Risk ◽  
Foreign Investors ◽  
The Czech Republic ◽  
Risk Premiums ◽  
Us States ◽  
The Us ◽  
The Usa

Investors' decisions are largely influenced by the riskiness of the country. Several different approaches are available to calculate this risk, but even so, the values set by Damodaran are usually used, even for non-US states. The aim of the paper is to propose a methodology for creating a risk premium in the environment of the Czech Republic and then compare it with Damodaran [1]. Methods applicable in the Czech Republic and Damodaran methods are used, then these methods are compared. For Czech as well as foreign investors, the easiest way to obtain a risk premium is to use the company’s investment rating. In the case of determining the risk premium of the Czech Republic, the easiest method is the CRP (country risk premiums) model. If the country’s market does not have a long history or does not have such a developed capital market, it is recommended to apply data from the US capital market. However, there are significant differences in the economy between Europe and the USA, so the data of an European country such as Germany, which has historical risk premium calculations, should be used.

scholarly journals Market Reactions to Audit Committee Director’s Gender: Evidence from US-Traded Foreign Firms

2011 ◽  
Author(s):  
Hua-Wei Huang ◽  
Yun-Chia Yan ◽  
James M. Fornaro ◽  
Ahmed Elshahat
Keyword(s):  
Audit Committee ◽  
Gender Diversity ◽  
Market Price ◽  
Abnormal Returns ◽  
Foreign Firms ◽  
Market Reactions ◽  
Market Participants ◽  
Positive Message ◽  
The Us ◽  
The Impact

This study investigates whether the appointment of a female to the audit committee of a foreign issuer in the US is positively associated with subsequent market price reaction. We hypothesize that female members on the audit committee can strengthen corporate governance by their conservative and ethical qualities. Accordingly, such appointments deliver a positive message to capital market participants. In order to observe the impact of audit committee gender diversity on foreign firms, we include all audit committee appointments of US-traded foreign firms from 2002 to 2009. We find that the appointment of female audit committee members has significant positive cumulative abnormal returns compared to the appointment of male audit committee members.  

The Future of Globalization

2018 ◽  
Author(s):  
Mahesh K. Joshi ◽  
J.R. Klein
Keyword(s):  
Home Country ◽  
Cross Border ◽  
The Us ◽  
The Future

Is globalization under attack? The current geopolitical environment is indicating a shift towards protectionism, nationalism, and isolationism. The US elections and Brexit are a reflection of public sentiments. It will be interesting to see how much the current rhetoric is able to dent globalization, which has become an integral part of our society because of technological interconnectedness. Globalization has been underway for centuries with trade, entertainment, cuisines, education, and politics. Today’s physical interconnectivity has been replaced by digital connectivity. There are more than 350 million cross-border e-commerce shoppers. In 2015 almost 200 million people were living away from their home country, and around 40 million were crossing borders for work. There are nearly 400 million international travelers every year.

China's divergent goals prevent coherent cyber policy

2015 ◽  
Keyword(s):  
Cyber Security ◽  
Security Policy ◽  
Legal Reform ◽  
Foreign Firms ◽  
The Internet ◽  
Economic Prosperity ◽  
Internal Security ◽  
Content Type ◽  
The Us ◽  
Business Conditions

Subject The politics of cyber security in China. Significance Since late April, state media have emphasised economic prosperity as the linchpin of internal security policy. This helps explain the suspension earlier in April of new cyber security rules that had elicited strong objections from leading technology corporations and the US, EU and Japanese governments. Impacts China has internal goals for regulation of the internet, but these will sometimes be subordinated to foreign policy. The Party's rigid, nationalistic propaganda line will complicate economic liberalisation at times. Legal reform will improve protection of foreign firms and intellectual property, even as business conditions deterioriate in other ways.

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