Showing papers in "International Journal of Emerging Markets in 2012"
TL;DR: In this article, a more comprehensive understanding of outward FDI from BRIC countries is presented, based on an exploratory approach, case studies of eight companies were conducted both within-case and cross-case approach.
Abstract: Purpose – Outward foreign direct investment (FDI) of firms from Brazil, Russia, India and China has increased significantly during the last few years. Despite this trend, comprehensive research on the specific determinants and antecedents of outward FDI from BRIC countries is still underrepresented. The purpose of this paper is to give a more comprehensive understanding of outward FDI from BRIC countries.Design/methodology/approach – Based on an exploratory approach, case studies of eight companies were conducted. Both a within‐case and a cross‐case approach were conducted.Findings – The findings reveal the relevance of determinants on the country, industry and firm level. Gaining access to new markets is of utmost importance for all firms. Additionally, most companies seek to obtain access to technological resources and management know‐how, therefore emphasizing the availability of these resources in the target countries. While the internationalization of Brazilian and Indian companies is primarily drive...
129 citations
TL;DR: In this article, the authors evaluate public intervention in this area and conclude that there are still pronounced liquidity gaps for firms in the SME sector in Poland and that the government programs are not effective in closing these liquidity gaps.
Abstract: Purpose – Access to finance appears to be the largest challenge for entrepreneurial firms from the small to medium‐sized enterprise (SME) sector in Poland. To address this concern, the government embarked on a program to yield financial and know‐how assistance to the SME sector. The purpose of this paper is to evaluate public intervention in this area.Design/methodology/approach – The study focuses on the analysis of primary data. The sampling frame for the study consisted of 278,088 firms from the SME sector in the Warsaw region. The sample size was equal to 500 firms from the SME sector. Questionnaires from 262 respondents were included in the study, for an effective response rate of 52 percent.Findings – The study concludes that there are still pronounced liquidity gaps for firms in the SME sector in Poland and that the government programs are not effective in closing these liquidity gaps.Originality/value – Problems with access to capital continue to be a challenge to developing a vibrant SME sector i...
61 citations
TL;DR: In this paper, the authors introduce a model that explores various possible determining factors in the rate of franchising among emerging nations, including geographical distance, cultural distance, uncertainty avoidance, individualism, political stability, and corruption.
Abstract: Purpose – The purpose of this paper is to introduce a model that explores various possible determining factors in the rate of franchising among emerging nations. Emerging markets are some of the fastest growing economies in the world; moreover, the countries they represent are undergoing substantial economic transformations. Yet despite all this, little is known about the factors influencing country selection for expansion into these markets. In an attempt to enhance the knowledge that managers and scholars have on franchising expansion, the present study examines how market conditions may constrain diffusion of franchising into emerging markets. They are: geographical distance; cultural distance; uncertainty avoidance; individualism; political stability, and corruption. The author also controlled for gross domestic product, the efficiency of contract enforcement, and nascent entrepreneurship.Design/methodology/approach – This study uses a quantitative approach applied to a sample of 63 Spanish franchisor...
58 citations
TL;DR: In this paper, the authors explored the financial obstacles faced by micro, small and medium enterprises (MSMEs) in the manufacturing sector of Fiji and Tonga and tried to evaluate the severity of the impact of each of these obstacles on the growth and survival of MSMEs.
Abstract: Purpose – Globally, there is an increased recognition of the important role played by micro, small and medium enterprises (MSMEs) in the economic development of a country. Similarly, in the South Pacific region, MSMEs is the main engine behind the economic growth. In particular, MSMEs is one of the biggest contributors to GDP, employment and plays a core role in the supply chain of large businesses. One of the major problems faced by MSMEs in South Pacific Island countries is a lack of finance to advance business growth. Against this backdrop, the purpose of this paper will be to examine the financial obstacles faced by MSMEs.Design/methodology/approach – The main objective of this study is to explore the financial obstacles faced by MSMEs in the manufacturing sector of Fiji and Tonga. In particular, this research tries to evaluate the severity of the impact of each of the financial obstacles on the growth and survival of MSMEs in Fiji and Tonga.Findings – The research involved conducting a survey of 200 ...
46 citations
TL;DR: In this paper, the authors analyzed the impact of the rise of emerging economies and emerging economy firms on multinational corporations (MNCs) with respect to four important strategic decisions for MNCs' foreign investment.
Abstract: Purpose – The purpose of this article is to analyze the impact of the rise of emerging economies and emerging economy firms on multinational corporations (MNCs) with respect to four important strategic decisions for MNCs' foreign investment – control and coordination strategies, geographic and product markets of entry, timing of entry, and organizational design for foreign subsidiaries.Design/methodology/approach – The author utilizes an integration of institutional perspective with the existing explanations of MNC activities, to support their arguments about the impact of the rise of emerging economies on MNCs' strategy and structure decisions. The author presents propositions linking the type of external governance structure in the emerging economy's institutional environment (rule based or relationship based) with the strategy and structure decisions for MNCs.Findings – The paper proposes that MNCs will follow different control and coordination strategies, geographic and product market strategies, entr...
45 citations
TL;DR: In this paper, the authors examine the magnitude of country, industry and firm-specific effects for firms competing in emerging economies and also explore differences between high and low performers, and find that the firm's specific effect is the most important one, and relatively equivalent in magnitude to the firm specific effects found in developed countries.
Abstract: Purpose – The purpose of this paper is to examine the magnitude of country, industry and firm‐specific effects for firms competing in emerging economies and also explore differences between high and low performers.Design/methodology/approach – The authors use ANOVA methodologies on samples from firms competing in Latin America between 1990‐2006.Findings – It was found that the firm‐specific effect is the most important one, and relatively equivalent in magnitude to the firm‐specific effects found in developed countries. Country and industry effects are less important than the firm‐specific effect. Contrary to previous studies that indicate that the country effect is relatively more important in emerging economies, the authors found that it is even less important than the industry effect, a result that has important implications for strategic management and international business theory. The source behind the strong firm‐specific effects might stem from their resources and capabilities to manage and take a...
43 citations
TL;DR: In this article, the competitive advantage of German renewable energy firms in India and China is analyzed based on the Porter's diamond model of competitiveness, which is modified and specified for the renewable energy industry.
Abstract: Purpose – The purpose of this paper is to analyze the competitive advantage of German renewable energy firms in India and China. Porter's diamond model is modified and specified for the renewable energy industry.Design/methodology/approach – Based on Porter's diamond model of competitiveness, the authors examine the demand for renewable energies in India and China and the ability of German firms to meet this demand.Findings – While the overall demand for renewable energies in India and China is significant, the study reveals remarkable differences in the fields of biomass, solar and wind energy. The findings are meant to address managers in the renewable energy industry and to aid policy makers in environmental support and action.Research limitations/implications – A major theoretical contribution of the study is the application of Porter's diamond model to the renewable energy industry, as well as the identification and operationalization of the relevant causal and proxy variables.Practical implications ...
41 citations
TL;DR: In this paper, a new capability-based model based on the trends that Indian firms build strategic capability before going for asset accumulation to compete at global levels is proposed, where various approaches including strategic alliances, joint ventures, and technology acquisition are used.
Abstract: Purpose – The purpose of this paper is to understand the int4ernationalization path(s) of emerging multinational corporations (MNCs) from India applying the existing theories. Later on, the paper aims to check for newer explanations using fresh concepts, if required.Design/methodology/approach – The paper relies upon information from published sources and company annual reports. The authors took CNX100 firms operating in three sectors: viz. automotive, pharmaceuticals and information services, and studied their path of internationalization to draw conclusions.Findings – Existing theories do not fully explain the internationalization process of emerging MNCs from India. The paper develops a fresh capability‐based model based on the trends that Indian firms build strategic capability before going for asset accumulation to compete at global levels. For this they use various approaches including strategic alliances, joint ventures, and technology acquisition.Research limitations/implications – The conceptual ...
39 citations
TL;DR: In this paper, the authors investigate the stability of the long-run relationships between emerging (India, China, South Korea, and Taiwan) and developed stock markets (USA and Japan) by investigating the hypothesis that the Asian emerging stock markets are increasingly converging with the US stock market over time.
Abstract: Purpose – The purpose of this paper is to investigate the stability of the long‐run relationships between emerging (India, China, South Korea, and Taiwan) and developed stock markets (USA and Japan). The study aims at adding to the literature on market integration by investigating the hypothesis that the Asian emerging stock markets are increasingly converging with the US stock market over time.Design/methodology/approach – The authors use time varying cointegration tests (rolling and recursive cointegration) which allow for time variation in the underlying data generating process (possible structural breaks in the long‐run relationships). Ten year index data from mid 1998 to 2008 of the respective stock markets have been used for this study.Findings – Empirical findings support the presence of one long‐run relationship (cointegration vector) between emerging and developed stock markets. Both domestic and external forces affect stock market behavior, leading to long‐run equilibrium but the individual Asia...
33 citations
TL;DR: In this article, the authors examined the relationship between people-level learning dimensions, structural level learning dimensions and performance outcomes in manufacturing, consultancy, KPO, BPO, financial services and others.
Abstract: Purpose – The primary purpose of this paper is to examine the relationship between people‐level learning dimensions, structural level‐learning dimensions and performance outcomes. The paper proposes and tests the original classification of dimensions of learning organization as given by Watkins and Marsick.Design/methodology/approach – The Dimensions of the Learning Organization Questionnaire (DLOQ) by Watkins and Marsick was adopted to gauge the relationship between people‐level learning dimensions, structural‐level learning dimensions and performance outcomes. In a modified model, empowerment was tested as a structural level dimension in the Indian context, while in previous studies carried out by Yang and Yang et al., it was treated as a people‐level dimension. This study adopted the smaller form of DLOQ and data were collected from 292 executives working in different types of organizations: manufacturing, consultancy, KPO, BPO, financial services and others, representing mostly domestic private, publi...
31 citations
TL;DR: In this paper, the authors examined the statistical properties of the volatility index of India, India Vix (Ivix), its relationship with the Indian stock market and its predictive power for forecasting future variance.
Abstract: Purpose – The purpose of this paper is to examine the statistical properties of the volatility index of India, India Vix (Ivix), its relationship with the Indian stock market and its predictive power for forecasting future variance. Further, the paper examines the volatility transmission between India and developed markets.Design/methodology/approach – The study uses quantile regression and VAR techniques to examine the empirical issues.Findings – The results of the study show that Ivix returns are negatively related to stock market returns and the leverage effect is only significant around the middle of the joint distribution. The asymmetric response of Ivix is also not observed in the left tail and is significant again around the centre of the distribution. Monthly volatility forecasts obtained from Ivix contain important information about future market volatility. Finally, overnight volatility movements from the US market have significant effect on the Indian market's volatility and transmission in opp...
TL;DR: In this paper, the authors studied the direct and cross-sectional relationship of India VIX in relation to three important parameters: viz., stock beta, market to book value of equity and market capitalization.
Abstract: Purpose – Earlier studies establish a positive relationship between volatility index (VIX) and the stock index returns. These studies are mainly restricted to developed markets and research in this regard in emerging markets is scarce. The purpose of this paper is to fill this gap.Design/methodology/approach – The paper studies the direct and cross‐sectional relationship of India VIX in relation to three important parameters: viz., stock beta, market to book value of equity and market capitalization. The paper constructs value weighted portfolio sorted on the basis viz., stock beta, market to book value of equity and market capitalization. The paper employs three‐factor multiple regression to find out the results.Findings – The paper finds that India VIX has a positive and significant relationship with the returns of the value‐weighted high‐low portfolios sorted on the basis of the above parameters. The paper examines the behavior of India VIX in the presence of the above two parameters. The India VIX yie...
TL;DR: In this article, the authors analyzed the extent and determinants of local sourcing of multinational enterprises by applying the two-limit Tobit model and found that an MNE's local sourcing decision is influenced by its strategies, characteristics such as size and learning ability and country of origin.
Abstract: Purpose – Local sourcing from indigenous firms by multinational enterprises (MNEs) is an important channel through which the former may benefit from the positive externalities generated by the latter. The purpose of this study is to analyze the extent and determinants of local sourcing of MNEs.Design/methodology/approach – Employing a survey dataset covering 493 multinational subsidiaries in China during 1999‐2005, this paper applies the two‐limit Tobit model.Findings – It is found that an MNE's local sourcing decision is influenced by its strategies, characteristics such as size and learning ability and country‐of‐origin. More specifically, export‐orientation strategy, joint venture strategy and networking with local suppliers positively affect local sourcing. Small and autonomous subsidiaries tend to source more locally. Age has a non‐linear effect. The importance of these determinants varies with regions.Research limitations/implications – Aiming at capacity building and competitiveness of indigenous f...
TL;DR: In this article, the authors analyse whether the concept of societal marketing being practised in developed countries can be directly applied to countries in transition, such as Belarus, and what adjustments would be beneficial to achieve this.
Abstract: Purpose – The purpose of this paper is to analyse whether the concept of societal marketing being practised in developed countries can be directly applied to countries in transition, such as Belarus, and what adjustments would be beneficial to achieve this. The paper takes a comprehensive view of the complex linkages between the implementation of corporate social responsibility (CSR) principles by examining elements of societal marketing in the European Union (EU) countries and in Belarus.Design/methodology/approach – Data are provided by the web sites of European best practice companies and data from the Global Compact that identifies socially‐responsible companies in the EU and Belarus. The results for Belarus are combined with the insights from capacity building activities on societal marketing organised by the Local Network Global Compact (LNGC) Belarus, for private and public enterprises.Findings – The research presents two groups of companies in Belarus: Start‐up companies see their CSR activities a...
TL;DR: In this article, an interpretive discourse analysis, with elements of framing analysis, of 102 articles on CR and CSR published in the major Ukrainian print media between 2007 and 2010, both in Russian and Ukrainian languages.
Abstract: Purpose – The purpose of this paper is to explore how corporate reputation (CR) and corporate social responsibility (CSR) are discussed in the print media in Ukraine. The paper also provides insights into how the implementation of these concepts contributes to the promotion of the market economy principles in Ukraine.Design/methodology/approach – This study employed an interpretive discourse analysis, with elements of framing analysis, of 102 articles on CR and CSR published in the major Ukrainian print media between 2007 and 2010, both in Russian and Ukrainian languages. The analyses revealed four major themes in discussing a growing importance of CR and CSR for Ukrainian businesses.Findings – The interpretive analysis demonstrated that the government of Ukraine and businesses try to establish standards for CR and CSR. It also showed that the current economic crisis contributed to the media coverage of how CR and CSR are defined. The framing analysis showed that some publications in Ukrainian tend to rep...
TL;DR: In this article, the authors examined how identity affects the adaptive processes of issue identification, strategic impulse definition, and implementation in family firms operating in an emerging economy based on measures of strength of identity, where the authors looked at pace of adjustment.
Abstract: Purpose – There is little doubt that organizational identity – that which is central, distinctive, and enduring about an organization – mediates in adaptive processes Exactly how this mediation takes place, and whether it is favorable or unfavorable to adaptation, must still be fully established The purpose of this paper is to add to the literature on identity and adaptation by exploring the relationship between these two constructs in family firms operating in an emerging economy Based on measures of strength of identity, the authors examine how identity affects the adaptive processes of issue identification, strategic impulse definition, and implementation, where the authors look at pace of adjustment
Design/methodology/approach – Longitudinal and comparative case studies were conducted of polar types presenting two pairs of organizations in two separate industries These organizations faced the challenge of founder succession and a radical shift in macroeconomic conditions over a period of three decades Through these four cases the authors hope to provide clear pattern recognition of strength of identity and adaptation – and of the relationship between these two constructs – in the face of severe internal and external shocks The approach seems adequate in the larger context of inductive theory development and particularly suitable to the exploration of theoretical constructs, as it allows the researcher to unravel the underlying dynamics of path dependencies and/or evolutionary processes
Findings – It is found that strong-identity organizations are able to foresee relevant changes in their industries, define adequate strategic responses, and implement them in an evolutionary (ie smooth) manner Conversely, loose-identity organizations misread industry trends, incur strategic paralysis, and must eventually enforce revolutionary (ie violent) changes in order to ensure survival
Originality/value – The paper addresses a critical issue for the advancement of organizational theory: the relationship between organizational identity and adaptation in emerging economies In addition, it has important practical implications for managers doing business in turbulent environments It makes a sound theoretical contribution and has important managerial implications
TL;DR: In this article, the effects of China's interest rate differential (IRD) and unemployment rate on the exchange rate are discussed, and the authors adopt cointegration analysis to evaluate the long-term equilibrium in China's economy, with the unit root test, cointegrating test and a vector error correction model also used to scrutinize China' exchange rate regime for different time periods.
Abstract: Purpose – The purpose of this paper is to discuss the change in China's exchange rate regime during the 2001‐2009 period, when both the pegged and floating exchange rates were adopted in the country, offering a rare opportunity to address the issue. The effects of China's interest rate differential (IRD) and unemployment rate on the exchange rate are also discussed in this paper.Design/methodology/approach – Given the economic variables are non‐stationary, this paper adopts cointegration analysis to evaluate the long‐term equilibrium in China's economy, with the unit root test, cointegrating test and a vector error correction model also used to scrutinize China' exchange rate regime for different time periods.Findings – The time series data – including the exchange rate, IRD and unemployment rate – are used in the unit root test and Johansen test to verify the long‐term equilibrium between real exchange rate and unemployment rate in specific periods of time. Since the findings indicate no correlation betw...
TL;DR: In this paper, the authors examined the demand for high quality auditors and the effect of their brand names on a security's pricing at the time of its initial public offering at the Thai capital market.
Abstract: Purpose – The purpose of this paper is to examine the demand for high quality auditors and the effect of their brand names on a security's pricing at the time of its initial public offering. Because the Thai capital market is highly regulated, especially in terms of auditor selection (i.e. the Thai Security and Exchange Commission provides a list of individually qualified auditors and underwriting firms that the issuing firms have to choose from), it is therefore of interest to look at the demand for reputable audit firms and the importance of reputation capital in the signaling mechanism.Design/methodology/approach – Data were collected from 100 issuing firms that went public between 2003 and 2008. Logistic regression and OLS regression were applied to test the relationship between the use of reputable audit firms and the level of underpricing of new issues. The demand for reputable audit firms in this highly regulated capital market is also examined.Findings – The results suggest that only the newer lar...
TL;DR: In this paper, the authors examined if the volatility in the US dollar interest rate swap market impacts the volatility of the swap rates in the Indian swap market and found that the spillover impact from the US markets to the Indian markets is also asymmetric.
Abstract: Purpose – The purpose of this paper is to examine if the volatility in the US dollar interest rate swap market impacts the volatility of the swap rates in the Indian swap market.Design/methodology/approach – The authors use GARCH, EGARCH, and TGARCH modeling to examine volatility spillover between the US and Indian interest rate swap markets.Findings – Evidence is found of volatility transmission from the US dollar interest rate swap markets to the Indian swap markets. There is no evidence of spillover from the Indian swap markets to the US swap markets. Furthermore, the spillover impact from the US markets to the Indian markets is also asymmetric. The impact on volatility is asymmetric for one‐year swaps, but not for five‐year swaps.Practical implications – Findings from this study will also identify any arbitrage opportunities that may exist between different segments of the US dollar interest rate swap markets and help to improve interest rate swap market efficiency.Originality/value – If the financial...
TL;DR: In this article, the authors provide basic statistics of fees and expenses charged by mutual funds in Thailand, and investigate the economic determinants of the variations in these charges, which can yield useful insights for policy makers regarding the competition and efficiency of the asset management industry.
Abstract: Purpose – The purpose of this research is to supply basic statistics of fees and expenses charged by mutual funds in Thailand, and to investigate the economic determinants of the variations in these charges.Design/methodology/approach – The authors construct an original dataset on characteristics of Thai mutual funds from annual reports filed between 2005 and 2007, and then use statistical analysis to investigate variations in fees and expenses.Findings – Funds that are small, entail higher risk, and offer special income tax benefits charge higher fees and expenses. Bond funds that produce high returns on investment tend to charge significantly lower fees and expenses when compared to those that produce low returns.Practical implications – Statistics from the gathered data can help investors better evaluate Thai mutual funds. Determinants of variations in the fees and expenses can yield useful insights for policy makers regarding the competition and efficiency of the asset management industry.Originality/...
TL;DR: In this paper, the authors used the multiple case study method to determine a success predictor for Vietnam-based international joint ventures (IJVs) by reviewing business records and personal interviews with senior management and staff.
Abstract: Purpose – The purpose of this paper is to determine a success predictor for Vietnam‐based international joint ventures (IJVs).Design/methodology/approach – Using the multiple case study method, seven successful IJVs in Ho Chi Minh City – Vietnam's largest and most economically dynamic metropolitan area – were examined by reviewing their business records and by personal interviews with senior management and staff. Two specific types of data collection procedures were applied: methodological triangulation (using multiple methods of data capture: in‐depth interviews, non‐participation observation during visits, and analysis both of companies' internal and external documents) and data triangulation (using a variety of data sources: spreading out during a 30‐month period and involved 75 in‐depth face to face interviews).Findings – Successful IJVs in Vietnam usually use four popular control mechanisms. Action‐control, result‐control, and personnel‐control mechanisms co‐exist in a closely‐knit environment yet st...
TL;DR: In this article, the specific criteria to the microstructure of emerging markets such as low liquidity, very pronounced asymmetric information, and high volatility affect the risk market are discussed.
Abstract: Purpose – The specific criteria to the microstructure of emerging markets such as low liquidity, very pronounced asymmetric information, and high volatility affect the risk market. Previous researchers have concluded that the calculation methods of the Value‐at‐Risk (VaR) adopted in developed markets are poorly adapted to the specific structure of emerging markets. The purpose of this paper is to see what these specific criteria of emerging markets are and whether these criteria have any impact on market risk and hedging capital. A second purpose it to see if practitioners should adjust the tools of risk measurement to the specifications of emerging markets and how the Value‐at‐Risk (VaR) should be adjusted.Design/methodology/approach – The paper asks what are the specific criteria to the microstructure of emerging markets? Should we adjust the tools of risk measurement to these specifications? How do we adjust the Value‐at‐Risk (VaR)?Findings – The paper demonstrated a market improvement in the performan...
TL;DR: In this paper, a discrete time asset pricing model where a non-marketable asset (human capital) along with other factors predicting stock returns, explain risk return relationship was proposed.
Abstract: Purpose – The purpose of this paper is to test a discrete time asset pricing model where a non‐marketable asset (human capital), along with other factors predicting stock returns, explain risk return relationship. The paper will add to the literature on risk return relationship with human capital by investigating the hypothesis that human capital is a significant factor affecting stock prices.Design/methodology/approach – The dynamic inter‐linkages of factors representing financial and human components of wealth in predicting stock returns is tested in the Indian market for the period of 1996:04 to 2005:06. The procedures employed include Granger causality tests, impulse response functions and seemingly unrelated regression estimates.Findings – Empirical findings validate the model that including human capital as a proxy for aggregate wealth in the economy can better predict stock prices than the standard empirical capital asset pricing model. There is a Granger cause relationship between security prices ...