Michael Asiamah, Daniel Ofori and Jacob Afful
The factors that determine foreign direct investment (FDI) are important to policy-makers, investors, the banking industry and the public at large. FDI in Ghana has received…
Abstract
Purpose
The factors that determine foreign direct investment (FDI) are important to policy-makers, investors, the banking industry and the public at large. FDI in Ghana has received increased attention in recent times because its relevance in the Ghanaian economy is too critical to gloss over. The purpose of this paper is to examine the determinants of FDI in Ghana between the period of 1990 and 2015.
Design/methodology/approach
The study employed a causal research design. The study used the Johansen’s approach to cointegration within the framework of vector autoregressive for the data analysis.
Findings
The study found a cointegrating relationship between FDI and its determinants. The study found that both the long-run and short-run results found statistically significant negative effects of inflation rate, exchange rate and interest rate on FDI in Ghana while gross domestic product, electricity production and telephone usage (TU) had a positive effect on FDI.
Research limitations/implications
The study found a cointegrating relationship between FDI and its determinants. The study found that both the long-run and short-run results found statistically significant negative effects of inflation rate, exchange rate and interest rate on FDI in Ghana whiles gross domestic product, electricity production and TU had a positive effect on FDI.
Practical implications
This study has potential implication for boosting the economies of developing countries through its policy recommendations which if implemented can guarantee more capital inflows for the economies.
Social implications
This study has given more effective ways of attracting more FDI into countries which in effect achieve higher GDP and also higher standard of living through mechanisms and in the end creating more social protection programs for the people.
Originality/value
Although studies have been conducted to explore the determinants of FDI, some of the core macroeconomic variables such as inflation, interest rate, telephone subscriptions, electricity production, etc., which are unstable and have longstanding effects on FDI have not been much explored to a give a clear picture of the relationships. Therefore, a study that will explore these and other macroeconomic variables to give clear picture of their relationships and suggest some of the possible ways of dealing with these variables in order to attract more FDI for the country to achieve its goal is what this paper seeks to do.
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This study aims to examine the international market selection process of entrepreneurs operating internationally.
Abstract
Purpose
This study aims to examine the international market selection process of entrepreneurs operating internationally.
Design/methodology/approach
Four small and medium-sized comparative and rich-information case studies were purposefully selected from among Australian and Arabian firms. Data were collected via in-depth personal interviews, follow-up interviews and questionnaire instrument.
Findings
The results revealed that entrepreneurs used a four-stage systematic decision-making process to attain profitable foreign market choices. The decision process was influenced by cognitive boundaries as entrepreneurs relied on the availability experiential, anchoring and adjustment heuristic.
Research limitations/implications
The research’s findings and the proposed decision model will, significantly, assist entrepreneurs, willing to expand internationally, in enhancing their decision-making to attain profitable foreign market choices. Further, it provides benefits to foreign investment policymakers in host countries by assisting them to attract more inward foreign direct investments, and, accordingly, enhance the economic and social development movement in their countries.
Originality/value
This study provides a significant theoretical contribution to the literature on the internationalization process of entrepreneurs and small- and medium-sized enterprises through developing a decision model for selecting and entering foreign markets by entrepreneurs in a cross-country context. Further, the study provides significant methodological contributions with regard to the effectiveness of the qualitative case study method in capturing elements of the foreign market selection process.
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This paper aims to highlight firms' profitability as an alternative channel by which changes in leverage could affect stock returns in an imperfect market setting. The author also…
Abstract
Purpose
This paper aims to highlight firms' profitability as an alternative channel by which changes in leverage could affect stock returns in an imperfect market setting. The author also analytically argues that the benefits of debt, if any, may accrue beyond the usual tax benefit channel.
Design/methodology/approach
The author used multivariate regression models based on firms' characteristics and the models' changes along with a two-stage least-square (2SLS) type procedure to estimate the impact of leverage changes on stock returns. The author controls for the varying arbitrage risk that is measured by forecasted idiosyncratic volatility of stock prices and overcome simultaneous or endogenous determination by using inter-temporal non-synchronous variation in leverage and control variables.
Findings
The author finds that increase in leverage increase (decrease) stock returns for firms with the gross operating profitability higher (lower) than the cost of debt. The author also finds that the variation in arbitrage risk does not substitute for the primary effect of leverage changes on stock returns.
Research limitations/implications
The author's findings provide tacit support to the recent literature attempting to resolve the empirically puzzling pattern of the negative relationship between profitability and leverage. The findings suggest inclusion of profitability as a crucial asset-pricing factor in the contemporary empirical models.
Practical implications
The non-trivial role of profitability in determining the effect of leverage on firms' stock returns that may be useful to managers, credit analysts and policy makers to assess the impact of net profitability on any change in leverage and its ensuing consequences on firms' value.
Originality/value
The paper develops analytical insights into the marginal role of profitability in influencing the relationship between firms' financing decisions and firms' stock returns beyond the conventional mechanisms of tax benefits, bankruptcy costs and information asymmetry.
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Ting Xiao, Zhi Yang and Yanhui Jiang
Which venture capital is more beneficial in the product innovation of entrepreneurial ventures? The authors study the drawbacks and different effects of corporate venture capital…
Abstract
Purpose
Which venture capital is more beneficial in the product innovation of entrepreneurial ventures? The authors study the drawbacks and different effects of corporate venture capital (CVC) and independent venture capital (IVC) on the effectiveness and efficiency of product innovation in entrepreneurial ventures to answer this question.
Design/methodology/approach
This study uses a panel dataset of 502 high-tech ventures and runs the Heckman model to correct potential endogeneity issues.
Findings
The authors find that CVC increases the product innovation effectiveness of entrepreneurial ventures, but decreases their efficiency. IVC reduces innovation effectiveness and enhances efficiency. However, CVC performs less positively, while IVC performs more positively in terms of innovation effectiveness and efficiency in the B2B market than in the B2C market.
Practical implications
This study provides insights into how to leverage venture capital to develop new products effectively and efficiently.
Originality/value
This study moves beyond the current understanding of the finance-marketing interface. It delineates the two faces of venture capital and reveals the joint effects of equity stakes and market stakes between different types of venture capital and transaction markets in product innovation.
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W.P.M. De Silva, Suranga Jayasena, Piyumi Thennakoon and B.A.K.S. Perera
The construction industry is responsible for over 30% of natural resource extraction and 25% of global waste generation. Modular construction (MC) offers an opportunity to move…
Abstract
Purpose
The construction industry is responsible for over 30% of natural resource extraction and 25% of global waste generation. Modular construction (MC) offers an opportunity to move towards a circular economy (CE), enhancing the value at the end-of-life stage through reuse and disassembly. However, a gap remains, prohibiting the full realisation of this potential. This study aims to bridge this gap by developing a strategic framework that enhances the end-of-life value of MBs by integrating CE principles by investigating key parameters, identifying relevant CE principles and formulating integration strategies to maximise their effectiveness.
Design/methodology/approach
This study adopts a qualitative research approach, using two Delphi rounds with experts selected through purposive sampling. The qualitative data were analysed using manual content analysis.
Findings
The research identifies six parameters that influence the end-of-life value of MBs and aligns them with suitable CE 9R principles. In total, 41 strategies are provided for integrating these principles with 6 parameters to enhance the end-of-life value of MBs.
Originality/value
The study findings present a systematic approach to integrating CE principles to enhance the end-of-life value of MBs. Identifying specific strategies integrating CE principles for each key parameter distinguishes it from previous research, which often lacks this level of focus on end-of-life parameter-specific strategies. The study contributes to a deeper understanding of the practical application of CE concepts in MC. Further, it offers practical strategies for enhancing the end-of-life value of MB to promote a sustainable built environment.