SMEs, FDI and Financial Constraints

Maeseneire, Wouter De; Claeys, Tine

doi:10.2139/ssrn.968694

Cited by 4 publications

(4 citation statements)

References 104 publications

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“…7, 9 12, 15, 16 Art. 3,5,8,13,14,16 Art . Por último, se debe destacar que la gran mayoría de los trabajos se centran en la idea del aprendizaje experiencial (adquisición de conocimiento basado en la experiencia internacional), centro de la escuela de la internacionalización como proceso gradual, cuyo máximo exponente es el modelo de Uppsala. Dos trabajos complementarios añaden a esta idea general aspectos adicionales.…”

Section: Conclusionesunclassified

Conocimiento para la internacionalización e inversión exterior de la pyme: un modelo descriptivo de la naturaleza y alcance de la relación

Cabrera¹,

Ortega²,

Loureiro³

2019

Revista ICE

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El presente trabajo acomete una revisión de la literatura sobre el conocimiento necesario para la internacionalización de la pyme mediante inversión directa en el exterior. En concreto, analiza la influencia que tal conocimiento tiene en la elección de la localización, del modo de entrada, y en los resultados derivados de la inversión directa en el extranjero. Como resultado, se aporta un modelo descriptivo de la naturaleza y alcance de la relación existente entre conocimiento para la internacionalización e inversión exterior de la pyme. Knowledge for the internationalisation and foreign investment of SMEs: A descriptive model of the nature and scope of the relationshipThis paper undertakes a review of the literature concerning the knowledge necessary for the internationalisation of SMEs through direct investment abroad. Specifically, it analyses the influence that such konwledge has on the choice of location, mode of entry, and the results derived from direct investment abroad. As a result, a descriptive model of the nature and scope of the relationship between knowledge for the internationalisation and foreign investment of SMEs is provided.Palabras clave: pequeñas y medianas empresas (pyme), internacionalización gradual, inversión directa extranjera (IDE), conocimiento para la internacionalización.

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Section: Conclusionesunclassified

Conocimiento para la internacionalización e inversión exterior de la pyme: un modelo descriptivo de la naturaleza y alcance de la relación

Cabrera¹,

Ortega²,

Loureiro³

2019

Revista ICE

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“…Smaller firms face financial constraints that impose an additional limitation on their ability to internationalize (Knight and Cavusgil, 1997; Maeseneire and Claeys, 2007). The European Commission (2003a) has acknowledged the difficulties such firms have in financing internationalization, for both equity and debt, and recognizes market failure caused by information shortfalls and transaction costs.…”

Section: The Hypotheses and Their Theoretical Foundationsmentioning

confidence: 99%

“…A financial environment that supports SME growth is a vital condition for the success of businesses. By extension, inadequate access to finance hampers economic growth (Maeseneire and Claeys, 2007). The size of the company and the sector it works in may significantly condition this response, which clearly merits analysis.…”

Section: Introductionmentioning

confidence: 99%

Decisive factors in company financial internationalization: an empirical study

Urionabarrenetxea

Castellanos

2009

Managerial Finance

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PurposeThis paper seeks to identify factors potentially conditioning firms’ financial internationalization. Companies often internationalize their financial areas as part of their larger internationalization strategy. In other words, such an initiative is associated with the internationalization of non‐financial business areas. However, the move to financial internationalization may also obey a specific strategy designed to take advantage of the opportunities offered by increasingly global financial milieus and markets. Then again, of course, it may respond to a combination of the two, in which case all the factors mentioned are likely to exercise some influence.Design/methodology/approachTo test these propositions, a sample of 461 firms located in the Basque Country (Northern Spain), were analyzed between 16 June and 13 July 2004. Primary data were collected by telephone surveys, with a specially designed questionnaire tested previously with a number of pilot businesses. The sample represents a confidence level of 95 percent and 4.25 percent as a maximum level of error. This sample was divided by company size and the sector each business worked in, maintaining, approximately, proportionality in each stratum with respect to the population. Mann‐Whitney and Kruskal‐Wallis tests and logit analysis were used, among others.FindingsCompanies most likely to go into debt abroad are larger and more internationalized commercially and in production. First are large exporting companies with one or more production facilities abroad (PFA), which are followed by: medium enterprises that export and which have at least one PFA and large companies that export but which have no PFA. The profile of firms with foreign shareholders begins with manufacturing companies that import, followed by commercial businesses that also import. One interesting feature is the low number of companies in the construction industry and the services sector, particularly the ones that neither export nor import.Research limitations/implicationsA sample of 461 firms located in the Basque Country (Northern Spain) were analyzed and thus the sample might be geographically limited. Also, the degree of financial internationalization of these firms is relatively low. A sample which covers a greater amount of financially internationalized firms, might have led to more solid conclusions.Practical implicationsThe most noteworthy practical implication of the paper is the confirmation that Basque firms still do not clearly perceive opportunities for financial internationalization. The barriers and risks to be faced beyond geographical borders weigh heavily. In other words, the threats companies are exposed to outweigh potential opportunities in international markets, or the conditions for financing and domestic financial investment available are in general more favourable than the conditions obtainable abroad.Originality/valueWithin the Basque firms, even if the commercial, supply and production internationalization has been analyzed at length, the financial internat...

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“…The rationale for using firms involved in FDI activities is like this. Since FDI is characterized by highly variable returns, asymmetric information and a high monitoring cost; as a result, access to credit is likely to be poor (De-Maeseneire and Claeys, 2007). First, returns to foreign investment are volatile and creditors do not want to share the risk with the firms.…”

Section: Introductionmentioning

confidence: 99%

Bank concentration and financial constraints on firm investment in UK

Saeed¹,

Esposito²

2012

Studies in Economics and Finance

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Purpose -The purpose of this paper is to investigate the impact of bank concentration on firm financial constraints to perform investment across two types of financial constraints firms. Design/methodology/approach -The authors analyse this relationship by estimating the investment-cash flow sensitivity across groups of firms classified according to debt maturity structure model. The firms were classified as short-term and long-term debt dependent firms. Empirically the authors analyze a sample that consists of the most recent dataset (over 2001-2009) of UK firms that engage in foreign direct investment by using fixed-effects and GMM-IV estimation techniques. Findings -Bank concentration was found to relax financial constraints on firm level investment. Results indicate that higher level financial constraints are associated with short-term debt dependent firms that exhibit high level of investment-cash flow sensitivity. Further, it was found that bank concentration is associated with reduction in financial constraints on firm investment and this effect is stronger for short-term debt dependent firms. Originality/value -Unlike previous studies, the paper investigates the bank concentration effects on UK foreign direct investing firms that are uniquely classified; based on distinctive dimension of financial frictions in capital market. Estimated results ascertain that information-based hypothesis is pertinent to the UK capital market.

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SMEs, FDI and Financial Constraints

Cited by 4 publications

References 104 publications

Conocimiento para la internacionalización e inversión exterior de la pyme: un modelo descriptivo de la naturaleza y alcance de la relación

Conocimiento para la internacionalización e inversión exterior de la pyme: un modelo descriptivo de la naturaleza y alcance de la relación

Decisive factors in company financial internationalization: an empirical study

Bank concentration and financial constraints on firm investment in UK

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