here is a osi e associa on between O tenure and the debt ro or on o micro nance ins tu ons. icro nance ins tu ons need im ro ed access to debt ca ital to co er a hu e and increasin world demand or micro nance ser ices. ore e erienced Os may be more ali ned with the micro nance ins tu on s mission, and they may ha e a be er understandin o the business model o micro nance. oreo er, ca ital ro iders may re uire a ro en trac record within the ins tu on to su ly undin . | While much research e orts ha e been ut into understandin whether oor eo le bene t rom accessin nancial ser ices, less 3 School o usiness and Law, ni ersity o der, orway rr s c Lei tle eisland, School o usiness and Law, ni ersity o der, Ser ice o 422, 4 04 ris ansand, orway. mail: lei .a.beisland uia.no * J. .L. classi ca on codes: 21, 32, 12 Strategic Change. 2018;27(4):329-337.wileyonlinelibrary.com/journal/jsc
This study examines whether the agency cost component referred to as “residual loss” differs between nonprofit and shareholder-owned microfinance organizations and whether such costs are further influenced by CEO power. We use operating expenses, asset utilization, liquidity, and tangible asset intensity to proxy for residual loss. Using 374 microfinance organizations located in 76 countries, we find evidence that the residual loss is higher in microfinance organizations incorporated as nonprofits, but only if the CEO is powerful. Our empirical evidence illustrates the importance of installing proper governance mechanisms to minimize costs caused by high managerial power in the nonprofit sector. When CEOs are not powerful, nonprofits appear to have lower residual loss than for-profit organizations do, consistent with a motivated agent perspective. An important message of our study is that traditional agency theory perspectives might be ill-suited to analyze residual loss as a function of the nonprofit versus for-profit organizational form.
The adoption of crowdfunding among entrepreneurs has increased recently, and several factors are believed to contribute to this increase. Surprisingly, extrinsic motivating factors' effect on this increased crowdfunding adoption trend is inadequately addressed. The study investigates the effect of extrinsic motivators on entrepreneurs' intention to adopt crowdfunding in Tanzania. It applies Partial Least Squares-based Structural Equation Modelling to examine the effect of the need for achievement, social networking, and the desire for financial power on entrepreneurs' intention to adopt crowdfunding. Using a sample of 241 entrepreneurs operating in Tanzania, the results indicate that the need for achievement and the desire for financial power influence entrepreneurs' crowdfunding intention. We observe no effect of the need for social networking on entrepreneurs' crowdfunding intention. These results imply that an entrepreneur's intention to borrow through a crowdfunding platform aligns more with the need for achievement and the desire for financial power rather than the need for social networking.
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