International Business Dissertations

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https://hdl.handle.net/10474/1864

The D.B.A. in international business trains highly qualified individuals for careers in academics, consulting and multinational corporations. This collection includes dissertations written by graduates of our D.B.A. program.

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Locational Determinants of US Cross-Border Venture Capital Investments into Developing Countries
(Southern New Hampshire University, 2023-02-02) Kiprop, Bridgitte; Broaden, Charlotte B.; Dhakar, Tej; Frutos-Bencze, Dina; Alhamis, Innocentus
This study investigated factors influencing US cross border VC investments into developing countries, whether these factors differ between the developing regions and characteristics of the most active US VC investment companies into these distant markets. As VC investors increasingly adopt global perspectives, their expansion into new frontiers of growth such as those in developing countries has grown. Securing VC financing is a key step towards growing developing countries startups since lack of access to external finance is one of the most cited obstacles to the growth of SMEs in these countries. However, cross-border VC investments suffer from increased information asymmetry risks as well as liabilities of foreignness in target portfolio companies’ host countries. Various methods were used to analyze the data and evaluate the hypothesis including – principal component analysis, fixed effects GLS panel data regression, and ANOVA. Our analysis shows that larger, older US VC investors with a global reach invested in developing countries. There is also a strong correlation between institutional quality, geographical distance, cultural disparities, and capital market development and cross border VC investment amounts in each developing country. Also, the four developing regions (Africa, MENA, Latin America & Caribbean, and Asia Pacific) differed significantly between each other in the four key locational determinants of cross border VC investments. Therefore, we conclude that institutional quality, geographical distance, cultural disparities, and capital market development are key determinants of cross border VC investments in developing countries.
Investor heterogeneity: Price momentum and trading volume reactions of foreign listed firms
(Southern New Hampshire University, 2018-09-27) Zhang, Yan; Aybar, Bulent; Samii, Massood; Ficici, Aysun; Dhakar, Tej
Investor homogeneity is an important assumption in the efficient market hypothesis. However, viewing the financial markets from the eye of a professional trader, they are never efficient. Financial markets are composed of heterogeneous investors with the aims of speculation. Due to the large gap between theory and reality, many anomalies often occur. Price momentum as one of the commonly seen anomalies attracts the most attention from both scholars and practitioners. Prior finance literature documents that momentum is caused by investors’ differential beliefs or investor heterogeneity. Recognizing the importance of investor heterogeneity prompts scholars to incorporate it into asset pricing models, but they face a series of challenges. The objective of this study is to address the current challenges of quantifying and testing predictions on investor heterogeneity. By analyzing investors’ compositions, I argue that foreign listed firms are natural habitats of diverse investors. Compared with pure US firms, foreign listed firms provide perfect market venues to study investor heterogeneity. Using stock data of 2,200 NYSE and NASDAQ firms from 2000 to 2017, I classified them into higher/low order foreign listed firms and pure US firms. Momentum is tested by the Winner and Loser strategy, while trading volume is modeled by a regression of absolute return on volume turnover. This study finds that the three groups of firms have long term momentum in decreasing order, and investor heterogeneity plays an important role in price momentum. From phenomenon to essence, this study constructs a novel paradigm to quantify and forecast investor heterogeneity. It is also the first study to investigate the microstructural explanation of momentum and trading volume, and to state the relationship between liquidity and heterogeneity. The “Two Period Order Flow Model” and the “Heterogeneous Market Hypothesis(HMH)” also have important implications and contributions in both academics and industry. The conclusions of this research can benefit professional traders and option strategists in designing their trading strategies; it can help researchers avoid using proxied variables to quantify investor heterogeneity, build heterogeneous asset pricing models and create theoretical foundations for technical analysis; the HMH is also an alternative theory in challenging the EMH; and it can also help regulators better understand the financial markets. (Author abstract)
A novel decision - Making model of the globalizing consumer behavior: Evidence from Chinese middle-class consumers who purchase luxury goods from overseas markets
(Southern New Hampshire University, 2019-04-04) Liu, Yang; Ficici, Aysun; Samii, Massood; Dhakar, Tej; Wang, Ling Ling
The goal of this study is to propose a valuable decision-making model in examining Chinese middle-class consumer behavior, specifically the new purchasing behavior regarding luxury goods. Chinese middle-class consumers purchase seventy percentage luxury goods from oversea markets, although they are available in their domestic market. The only difference between the Chinese market and foreign markets is the price as in China, price is much higher than in other markets. However, this observation conflicts with previous theories of the luxury goods consumer behavior, such as the Veblen Effects, the Bandwagon Effect, and the Snob Effect, all of which imply luxury consumers are not price sensitive. This study is both qualitative and quantitative as it provides a conceptual propositional model and tests it by variety of empirical regression models. The results agree with the previous research that illustrate Chinese middle-class consumers are also price insensitive to luxury goods. They are pushed out to the global market by the luxury goods companies, which attempt to limit the purchasing channels in China. (Author abstract)
Overinvestment of free cash flow in emerging market firms: An empirical analysis
(Southern New Hampshire University, 2018-12-15) Hruban, Nicole; Aybar, Bulent; Chugh, Lal; Dhakar, Tej; Samii, Massood
Free cash flow overinvestment stemming from agency conflicts and moderators of this relationship have been empirically confirmed in several studies for developed markets. Research on emerging market firms has however produced less coherent results. While it can be argued that these incongruities are a consequence of the samples analyzed and the methodologies applied, they might also be rooted in the theoretical underpinnings: Agency theory originates from developed market research, consequently assuming an institutional environment as well as firm characteristics different from those observed in emerging market companies. This study empirically evaluates the investment behavior of a sample of emerging market firms with a methodology that specifically allows a test of the agency-based explanation of excess investment. The findings support overinvestment as a function of free cash flow, thereby confirming the free cash flow hypothesis in emerging market firms. Additionally, the results propose that this relationship can be negatively moderated by corporate governance mechanisms as well as ownership concentration; suggesting (similar to developed market firms) a principal -agent conflict motivated overinvestment. Debt as a “traditional” way to mend this agency problem can however not be confirmed. Furthermore, the study provides empirical evidence for a moderating effect of the institutional environment on the free cash flow overinvestment relationship via its interaction with firm characteristics. This proposes that the two are interrelated and that agency theory might not be invariant to the specific institutional setting. (Author abstract)
Climate change and sustainability strategy: MNCs performance assessment - impact of climate change on business sector
(Southern New Hampshire University, 2018-11) AL Ghunaim, Mashari S; Samii, Massood; Dhakar, Tej; Aybar, Bulent; Lightfoot, William; Zilch, Kathleen
Climate change poses many challenges for business operations worldwide. The study evaluated multinational companies (MNCs) and the implications of climate change on their business operational activities. Moreover, the study adopted a mixed-methods research design in a bid to evaluate sustainability strategies embraced by these business organizations purposely to counter climate change risks. Two methods were adopted for this research. First, this study utilized the quantitative method where the Natural-Resource-Based View (NRBV) concept was adopted to investigate whether companies are complying with the implementation of strategies geared towards reducing its impact on climate change compared to their competitors whose strategies are less proactive. This study also embraced, the Return on Assets (ROA) and Asset Turnover (AST) for assessment purposes given their distinctive nature as financial parameters. The criteria used to select companies for this study was based on their best practices that met the requirements of the MSCI ESG Global Indexes, like, Climate Index, Environment Index, Pollution Index, Clean Technology, and Sustainability Index. The companies for this study were selected from industries located in the United States, Japan, ٍand some European and Asian countries. Findings for the first part of the study reveals that, United States companies, the proactive MNC’s financial parameter (mean AST) was significantly lower than the less proactive MNC’s. While, in the Japanese, Europe, and the Global group samples of the proactive MNC’s, financial parameter (mean ROA) was significantly higher than less proactive MNCs. Remaining Asian group sample show, no significant differences in mean ROA or the mean AST across proactive and less proactive MNC’S. Second, the study also utilized a qualitative method where research participants shared their different experiences, viewpoints, ideas, and thoughts on climate change were sought. The methodology also entailed the selection of 108 companies to help understand the impact of climate change on business and the sustainability strategies adopted to cope climate change risks. Data collection was conducted through self-administered open-ended questions with data analyzed qualitatively and quantitatively through thematic and descriptive methods respectively. In this part it was found that slightly more than half of the subjects were awareness of on climate change while the rest had no idea on climate change or were uncertain about the concept. By contrast, about three quarters of the subjects were not aware about the difference between climate change adaptation and mitigation; a quarter of them had some knowledge on the difference while only about a tenth of them were well versed with the differences. 45.37% of the subjects agreed that their companies were proactive in climate change adaptation, 28.70% strongly in agreed, 14.81% were uncertain and 10.19% disagreed. Only 1.85% of the subjects strongly disagreed. Moreover, 60.19% of the subjects disagreed that climate change affects business while 40.74% supported the idea. 56% of the companies did not have the climate change adaptation plan versus 44% that had. Additionally, 72.22% of the companies did not have the sustainability strategy for climate change versus 27.78% that had. Regarding knowledge sharing on mitigation and adaptation with partners, slightly more than one third of the companies shared their knowledge with partners compared to slightly more than half of the companies that did not. The study recommended future research to explore on factors contributing to this practice in order to facilitate effective climate change management. (Author abstract)

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