Industrial diversification and performance in an emerging market

Purpose The purpose of this paper is to investigate the previous mixed findings in the relationship between diversification and firm performance. Using international and industrial conglomerates, the paper introduces productivity as a moderating variable to ascertain whether the mixed views in the diversification-performance nexus is due to variations in productivity. The findings in both proxies of performance (q and return on asset (ROA)) show that productivity is not a significant moderator in the diversification-performance link, except that under industrial conglomerates productivity enhances ROAs significantly. Meanwhile, the results show that diversification either has no significant value on firm performance or relates negatively with performance – a contrasting result to the hypothesis of this study. Design/methodology/approach This study adopts diversification measurement, categorisation approach and the methodology used in the work of Fauver et al. (2004) and the subsequent modification by Lee et al. (2012). This study, however, investigates the moderating effect of productivity on diversified firms and not ownership as shown in the previous studies. Performance is measured by two proxies to show robustness of the study. ROA is an accounting tool and Tobin’s q reflects a market-based performance of the firm. Findings The results show that productivity has no moderating impact on a market-based performance of a diversified firm. Regarding ROA, results show a split in finding by showing that productivity has no significant impact on international diversification; however, for industrial diversification, results show significant impact. Originality/value The paper adds to knowledge of finance by ruling out the view that the inconsistencies in the diversification and performance nexus in emerging economies could be due to vagaries in productivity. It is confirmed that productivity technically does not strengthen the link between diversification and performance: suggesting that factors other than productivity could establish a maximal impact on that link to minimise the inconsistencies in the findings on diversification-performance link.

Download Full-text

EXPRESS: Unbundling the Effects of Internationalization on Firm Performance in Emerging Economies: The Moderating Effects of Strategic Resource Decisions

Journal of International Marketing ◽

10.1177/1069031x211030686 ◽

2021 ◽

pp. 1069031X2110306

Author(s):

Nilay Bicakcioglu-Peynirci ◽

Robert E. Morgan

Keyword(s):

Firm Performance ◽

Emerging Economies ◽

Emerging Market ◽

Strategic Marketing ◽

Slack Resources ◽

Moderation Effect ◽

Strategic Resource ◽

And Performance ◽

Resource Decisions ◽

The Relationship

We investigate how strategic resource decisions—concerning slack resources and strategic marketing ambidexterity—influence the relationship between internationalization and firm performance of emerging market firms. Based upon the resource-based view, we synthesize two dominant, yet divergent, perspectives that explain the respective resource slack advantages and liabilities in the internationalization literature: the flexible capacity and the efficient capacity perspectives. We also explore the moderating role of strategic marketing ambidexterity which comprises a bundle of marketing activities covering both exploitation-dominant actions and exploration-dominant actions. We empirically examine our hypothesized relationships with data from a sample of 1,683 firm-year observations for the period between 2005 and 2018 and find that distinct forms of resource slacks have contrasting effects on the relationship between internationalization and performance. Our results provide strong evidence for positive moderation effect of unabsorbed slack resources and a negative moderation effect of absorbed slack resources on the internationalization-performance relationship. We also indicate nonsignificant moderating effect of strategic marketing ambidexterity, demonstrating that internationalization attains higher firm performance regardless of its exploration-dominant or exploitation-dominant strategic emphasis in emerging economies.

Download Full-text

An Investigation of the Relationship between Sukuk and the Performance of banks of Pakistan

IJTIHAD Jurnal Wacana Hukum Islam dan Kemanusiaan ◽

10.18326/ijtihad.v1i1.53-66 ◽

2019 ◽

Vol 19 (1) ◽

pp. 53-66

Author(s):

Sitara Bibi ◽

Fatima Mazhar

Keyword(s):

Regression Analysis ◽

Data Analysis ◽

Panel Data ◽

Positive Relationship ◽

Panel Data Analysis ◽

Negative Relationship ◽

Adverse Impact ◽

Significant Positive Relationship ◽

Two Stages ◽

The Relationship

Using panel data analysis, this study investigates the relationship among Islamic bonds (Sukuk) and the performance of IB’s of Pakistan for the period of 2008-2017. The study has used two stages approach. At the first stage, the profitability and liquidity of banks have been measured by calculating financial ratios. These ratios were than further used in regression analysis to examine whether a relationship exists between Sukuk and the bank’s profitability and liquidity. Our study found a significant positive relationship among Sukuk and the liquidity of IB’s. While, the results show significant but negative relationship between Sukuk and profitability of IB’s. Based on the findings of the study, we concluded that Sukuk has an important role in enhancing the liquidity of IB’s but it has adverse impact on the profitability of IB’s of Pakistan. Thus, the emergence of Sukuk market may pose threats to the profitability of the IB’s of Pakistan.

Download Full-text

INDUSTRIAL DIVERSIFICATION AND FIRM PERFORMANCE OF MANUFACTURING: DOES EFFICIENCY MATTER?

TRIKONOMIKA ◽

10.23969/trikonomika.v17i2.1146 ◽

2018 ◽

Vol 17 (2) ◽

pp. 72

Author(s):

Rahmat Setiawan ◽

Riska Agustin

Keyword(s):

Firm Performance ◽

Market Share ◽

Sampling Method ◽

Positive Relationship ◽

Significant Positive Effect ◽

Manufacturing Companies ◽

Industrial Diversification ◽

Relationship Of ◽

The Relationship ◽

Positive Effect

Industrial diversification is one of the important strategies in developing the firm’s market share which is expected to improve firm’s performance. When a firm wants to diversify the industry, it requires knowledge and efficiency of managers in managing the strategy so that it can increase the benefits of the existence of industrial diversification relationship with firm’s performance. This study aims to examine the effect of efficiency on the relationship between industrial diversification and firm’s performance in manufacturing companies in Indonesia. By using the purposive sampling method and the 2012-2016 study periods, we obtained data from 70 manufacturing companies with a total of 253 observations. We found that industrial diversification had a significant positive effect on firm’s performance. Efficiency as a moderating variable shows that efficiency strengthens the positive relationship of industrial diversification on firm performance.

Download Full-text

International Entrepreneurship: A Meta–Analysis on the Internationalization and Performance Relationship

Entrepreneurship Theory and Practice ◽

10.1177/1042258718795346 ◽

2018 ◽

Vol 42 (5) ◽

pp. 734-768 ◽

Cited By ~ 36

Author(s):

Christian Schwens ◽

Florian B. Zapkau ◽

Michael Bierwerth ◽

Rodrigo Isidor ◽

Gary Knight ◽

...

Keyword(s):

Firm Performance ◽

Empirical Evidence ◽

Positive Relationship ◽

International Entrepreneurship ◽

Meta Analysis ◽

Future Research ◽

Entrepreneurial Firms ◽

Research Opportunities ◽

And Performance ◽

The Relationship

The article conducts a meta–analysis on the relationship between internationalization and firm performance in international entrepreneurship. Empirical evidence from 15,648 internationalizing entrepreneurial firms nested in 43 independent samples reveals a positive relationship between degree and scope of internationalization and performance. Knowledge intensity positively moderates the relationship between speed of internationalization and performance and negatively moderates the scope of internationalization and performance association. In contrast, we neither find a relationship between speed of internationalization and performance nor for knowledge intensity's moderation on the degree of internationalization–performance association. Based on the findings, the article systematically points at future research opportunities.

Download Full-text

The role of firm characteristics on the relationship between gender diversity and firm performance

Management Decision ◽

10.1108/md-02-2015-0075 ◽

2016 ◽

Vol 54 (6) ◽

pp. 1407-1419 ◽

Cited By ~ 24

Author(s):

Mehmet Nihat Solakoglu ◽

Nazmi Demir

Keyword(s):

Firm Performance ◽

Emerging Market ◽

Gender Diversity ◽

Firm Level ◽

Content Type ◽

Specific Factors ◽

And Performance ◽

The Relationship ◽

Measures Of Performance

Purpose – The purpose of this paper is to understand the effect of gender diversity on firm performance and evaluate how that relationship is influenced by some firm-specific factors for firms in an emerging market. Design/methodology/approach – The authors collected firm level financial data and firm level characteristics for the firms listed in BIST100 index of Borsa Istanbul for the period between 2002 and 2006. Due to endogeneity of gender diversity and firm performance, the authors utilize unbalanced panel data with 2SLS specification. To observe the sensitivity of results across measures of performance, three measures of performance, two accounting-based and one market-based, are utilized. Findings – Overall, the authors find some weak evidence that gender diversity impacts firm performance. In particular, the findings imply significant association between gender diversity and firm performance for firms that are targeting local markets, for firms in the financial sector and for firms that are family or block-owned. Moreover, findings are fragile with respect to the measures of diversity and performance selected. Originality/value – Although the relationship between gender diversity and firm performance are investigated several times in the past, there are not many studies that examines the role of firm-specific factors on that relationship. By revealing the factors that are important, this study provides an explanation why the existing literature leads to mixed results.

Download Full-text

An investigation of the relationship between sukuk and the performance of banks of Pakistan

IJTIHAD Jurnal Wacana Hukum Islam dan Kemanusiaan ◽

10.18326/ijtihad.v19i1.53-66 ◽

2019 ◽

Vol 19 (1) ◽

pp. 53-66

Author(s):

Sitara Bibi ◽

Fatima Mazhar

Keyword(s):

Regression Analysis ◽

Data Analysis ◽

Panel Data ◽

Positive Relationship ◽

Panel Data Analysis ◽

Negative Relationship ◽

Adverse Impact ◽

Significant Positive Relationship ◽

Two Stages ◽

The Relationship

Using panel data analysis, this study investigates the relationship among Islamic bonds (Sukuk) and the performance of IB’s of Pakistan for the period of 2008-2017. The study has used two stages approach. At the first stage, the profitability and liquidity of banks have been measured by calculating financial ratios. These ratios were than further used in regression analysis to examine whether a relationship exists between Sukuk and the bank’s profitability and liquidity. Our study found a significant positive relationship among Sukuk and the liquidity of IB’s. While, the results show significant but negative relationship between Sukuk and profitability of IB’s. Based on the findings of the study, we concluded that Sukuk has an important role in enhancing the liquidity of IB’s but it has adverse impact on the profitability of IB’s of Pakistan. Thus, the emergence of Sukuk market may pose threats to the profitability of the IB’s of Pakistan.

Download Full-text

AGENCY CONFLICTS AND OPERATING PERFORMANCE IN AN EMERGING MARKET

Corporate Ownership and Control ◽

10.22495/cocv14i1p7 ◽

2016 ◽

Vol 14 (1) ◽

pp. 73-83 ◽

Cited By ~ 1

Author(s):

Manas Mayur

Keyword(s):

Positive Relationship ◽

Emerging Market ◽

Negative Relationship ◽

Intermediate Level ◽

Curvilinear Relationship ◽

Agency Conflicts ◽

Ipo Performance ◽

And Performance ◽

The Relationship ◽

Very High

The study examines the relationship between post-IPO performance of 306 Indian firms and the changes in insiders’ ownership around their IPOs? The results illustrated a curvilinear relationship between ownership and performance. Whereas the negative relationship was found for low and very high ownership level and positive relationship was found for intermediate level. This is an attention-grabbing outcome as it contrasts with earlier studies on curvilinear relationship between ownership and performance, where the negative relationship was found for intermediate level and positive relationship was found for both very low and very high ownership level.

Download Full-text

Employee Engagement and Performance in Selected Ministries in Anambra State Civil Service of Nigeria

Journal of Economics and Public Finance ◽

10.22158/jepf.v2n2p280 ◽

2016 ◽

Vol 2 (2) ◽

pp. 280

Author(s):

Dr. Orogbu Lilian Obiageli ◽

Dr. Onyeizugbe Chinedu Uzochukwu ◽

Dr. Onwuzuligbo Leo ◽

Agu Ifeyinwa Angela

Keyword(s):

Employee Engagement ◽

Positive Relationship ◽

Finite Population ◽

Civil Service ◽

Employee Involvement ◽

Goal Achievement ◽

Significant Positive Relationship ◽

Anambra State ◽

And Performance ◽

The Relationship

<p><em>This study was necessitated by the inefficiency that has trailed the performance of employees in the Civil Service in Anambra state. The objective of this study is to ascertain the extent to which employee involvement correlates with goal achievement in Anambra State Civil Service. The study employed correlational survey research design, with a population of 684 employees, and a sample size of 252 was determined with the use of Taro Yamane formula of finite population, the questionnaire allocation was determined using Bowley’s proportion allocation formula. The study obtained information from the data using mean and standard deviation. The hypothesis was tested using Pearson’s Product Moment Correlation Co-efficient on SPSS version 20, which establishes the extent of the relationship between the variables under consideration. The findings showed that employee involvement has a significant positive relationship with goal achievement in the selected ministries. The researcher recommended that the Civil Service should engage in induction training to specify work roles to each employee, encourage involvement of employees in decision making and feedback should be given on their performance with commensurate reward.</em></p>

Download Full-text

The relationship among reputation, inter-organizational trust and alliance performance

Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis ◽

10.11118/actaun201361040899 ◽

2013 ◽

Vol 61 (4) ◽

pp. 899-908

Author(s):

Roman Fiala ◽

Martin Prokop

Keyword(s):

Structural Equation ◽

Positive Relationship ◽

Central Office ◽

Fit Indices ◽

Alliance Performance ◽

Significant Positive Relationship ◽

Model Fit Indices ◽

And Performance ◽

Using Data ◽

The Relationship

The article deals with an investigation of the relationship between reputation of the invoicing central office, trust in it, and performance of the retail alliance. Using data obtained in a questionnaire survey in 259 organizations, which are members of alliances, we found the relationship between reputation and alliance performance, mediated by the trust. Also, the statistically significant positive relationship between reputation of the invoicing central office and trust in it and the statistically significant positive relationship between trust and alliance performance were confirmed. The structural equation modelling technique was used in the calculations. The calculated model fit indices (CFI, NNFI) with values over 0.9 demonstrate a very good quality of the model.

Download Full-text