FALL 2009
VOLUME10, NUMBER2

INTERNATIONAL CORPORATE CAPITAL STRUCTURE: DYNAMICS AND DETERMINANTS

NyoNyo A. Kyaw

This paper uses the GMM estimator with target adjustment to examine the dynamics of capital structure in 28 countries. Firms are found to adjust their capital structures slowly to the target level indicating the existence of adjustment costs in the process of adjusting the debt level toward its target. Our results provide evidence that firms in common law countries, and in countries with better stock market development or liquidity, carry lower debt ratios indicating that the lower information asymmetry in these countries enhances the firm’s ability to issue equity. We find a positive relationship between

the firms’ debt ratios and both a country’s economic growth and corruption perception index. These results are found to vary among industry sectors in terms of the effect of these factors on the use of total and long-term debt ratios.


https://doi.org/10.51240/jibe.2009.2.1          PDF

MULTINATIONAL CORPORATIONS' ROLE IN IMPROVING LABOUR STANDARDS IN DEVELOPING COUNTRIES

Nazia Habib-Mint

This paper revisits the discourse on the roles of various stakeholders in improving labour standards in developing countries, paying particular attention on the role of multinational corporations (MNCs). This article argues that big business’s ability to improve labour standards is a multifarious issue, often misunderstood as overlapping motivations from a plethora of actors like the nation state, national and international labour unions and donor agencies are inter-engaged in complex political-economic contexts and have yet to agree on universal labour standards. None of the actors have sole responsibility or can unilaterally improve labour standards. While MNCs are seeking profit, developing countries are caught between foreign direct

investment and overall economic growth through global trade. To substantiate, this article considers representative examples from mass produced consumer goods industries, which are major foreign exchange earners in developing countries, and are positioned at the centre of North-South and South–South competition in the complex matrix of global trade.


https://doi.org/10.51240/jibe.2009.2.2          PDF

INTERNATIONAL BUSINESS BY SMES: EMPIRICAL FINDINGS FROM NEW ZEALAND

Ilan Alon, Leo-Paul Dana, and Anna Jenkins

Why do small firms from small countries internationalize? This study investigates the motives of small-scale entrepreneurs from New Zealand to internationalize via exporting, and particularly evaluate the role of government assistance. Our empirical findings of 139 SMEs situated in the Canterbury region of New Zealand suggest that export is strongly related to government-induced programs. Also important are personal motivations, declining domestic sales, saturated domestic market and excess capacity.


https://doi.org/10.51240/jibe.2009.2.3          PDF

THE GREAT RECESSION, GLOBAL CONDITIONS FROM WEST TO EAST AND BACK AGAIN: A FORWARD LOOKING COMMENTARY

Darryl J. Mitry and David E. Smith

This article examines national economies, the processes of the global financial system, the relationship to the expansion of global enterprise and the future. The article describes how the process of global economic integration was largely accomplished by a monetary amplification that supported chronic East-West trade imbalances that are unsustainable. The mechanism for much of the recent global economic growth is identified and shown to be untenable because the consequences of the process eventually results in a subsequent reversal and global contraction. Tracing the reactions in terms of who assumes the costs and who receives the benefits helps to illuminate the nature of the process and the subsequent failure. The future consequences are examined, contrasting policies are compared and recommendations for solving the problems are offered.


https://doi.org/10.51240/jibe.2009.2.4          PDF

MODERN 3PL SERVICES IN CHINA: THE ROLE OF TRUST

Paul Ghijsen, Janjaap Semeijn, and Amy Wang

The purpose of this research is to provide an understanding of the contemporary 3PL market in China. This study links trust, IT and 3PL usage and customer relationships. Also, the importance of social connections in business operations is highlighted. The manuscript shows the influence of trust, IT and 3PL usage on customer service performance, and its consequence for satisfaction and loyalty. 3PL usage appears to have a positive influence on service performance. Furthermore, service performance improves the customer relationship outcomes, in terms of satisfaction and loyalty via trust. Trust seems to have a mediating role.


https://doi.org/10.51240/jibe.2009.2.5          PDF

TRADE BLOCKS AND THE GRAVITY MODEL: EVIDENCE FROM WESTERN HEMISPHERIC COUNTRIES

E.M. Ekanayake, Amit Mukherjee, and Bala Veeramacheneni

We analyze the major trade blocks in Western Hemisphere and their effects on intra-regional trade flows using data for the period 1980-2006. We use an augmented gravity model to estimate the effect of various trade blocks on trade flows within and across membership groupings as well as the effect of trade blocks on members’ trade with other Western Hemispheric countries. The findings of this study are consistent with findings of previous studies on Western Hemisphere trade flows and shed some light on whether the proposed Free Trade Area of the Americas is beneficial or not for Western Hemispheric countries.


https://doi.org/10.51240/jibe.2009.2.6          PDF

EXPLORING THE CHARACTERISTICS OF THE FOUNDER AND CEO SUCCESSION AS CAUSES OF CORPORATE LONGEVITY: FINDINGS FROM KOREAN LONG-LIVED COMPANIES

Dong-Sung Cho and Se-Yeon Ahn

What are the common characteristics of the founder and CEO succession process at long-lived companies? And how do these characteristics help companies survive long periods of time? This inductive study of 26 Korean long-lived companies led to propositions exploring these questions. Long-lived companies had long-tenured founders, less frequent successions, high ratio of insider succession and a formal succession process to secure management stability and competitiveness. It was also observed that the founding vision had an emphasis on corporate social responsibilities and that founding philosophy has succeeded to current management philosophy in most long-lived companies. The study results imply that the heritage of founding stages may play a crucial role for companies to achieve future longevity.


https://doi.org/10.51240/jibe.2009.2.7          PDF