Expansion Of Firms Research Articles

Population-based algorithm for discrete facility location with ranking of candidate locations

Facility location problems are mathematical optimization problems that involve finding the best locations for facilities (e.g., factories, warehouses, stores) to serve customers within a given geographic area. The goal is typically to minimize costs, maximize efficiency, or optimize other objectives. Facility location problems can vary in several ways, including customer behavior rules, the type of search space, and constraints on locations for new facilities being located. These variations directly impact the complexity of the problem and the appropriate solution methods that can be used to tackle the problem. This research is focused on the discrete competitive facility location problem for an entering firm, which is a crucial scenario for new firms entering the existing market. The goal is to strategically locate new facilities to maximize their profit, while considering existing competitors. A new random search heuristic algorithm to approximate the optimal solution for discrete competitive facility location problems for firm expansion has been developed. The algorithm extends its precursor that ranks potential locations for the new facilities depending on their usefulness and uselessness in creating new solutions in the past. The new algorithm uses a population to handle and reuse the best solutions found so far and new strategies for ranking potential locations, considering features of the solutions in the population. The designed algorithm has been investigated by solving competitive facility location problems actual for an entering firms using real geographical data.

Firm growth and firm value: Moderation role of board size during Russia-Ukraine war

This study’s objective is to investigate the influence of board size as a moderator in a research model examining the impact of firm growth on firm value, considering the impact of the Russia-Ukraine war on Indonesia over the past seven years. The study consisted of 328 observations, ranging from 2014 to 2021. This study discovered that company expansion has a considerable beneficial impact on firm value. The board of directors has the ability to operate as a moderating variable, whereas the board of commissioners did not moderate the impact of firm expansion on company value. The results of the research aligned with the signaling theory, which posited that a company's ability to expand is a crucial indicator of its success. The market responded positively to this positive signal, drawing in new investors who subsequently increased the company’s value. This study revealed that, despite their important functions in a company, the board of directors and the boards of commissioners were unable to mitigate the impact of firm expansion on firm value. This could be caused by external factors like the Indonesian economy and market during the Russia-Ukraine conflict. The Russia-Ukraine war affected Indonesian companies, but they remained stable until now. The researcher was unable to acquire financial data from non-public firms impacted by the conflict between Russia and Ukraine, resulting in a small sample size.

Direct search or remote search? Export market expansion path for firms in underdeveloped areas - evidence from the five cities of the Hexi Corridor, China

ABSTRACT The expansion of firms’ export markets is crucial for their own growth and local economic growth. Studies suggest two market expansion modes: direct search and remote search. However, research often overlooks underdeveloped areas and the influence of firm heterogeneity. Using data from China Customs Database and CEPII Database, this article investigates the export market expansion patterns of firms in underdeveloped regions. The study focuses on five specific cities in the Hexi Corridor, a representative underdeveloped region in western China. The results show that firms in underdeveloped areas mainly follow the remote search path during their export market expansion. The likelihood of success in entering new target markets is significantly influenced by the similarity between the target market and their existing markets, while the geographical distance between trade partners has little effect. Additionally, there are significant differences in the market expansion path of different types of firms. Private-owned enterprises demonstrated a greater reliance on the remote search mode than state-owned enterprises, collective-owned enterprises and Sino-foreign joint ventures. It may stem from their limited ability to access resources and policy support.

A Structural Investigation of Quantitative Easing

Abstract Using nonlinear Bayesian methods that fully account for the binding zero lower bound (ZLB), we estimate a large-scale macrofinance DSGE model on U.S. data. Counterfactual analysis suggests that by easing financing conditions, quantitative easing facilitated a net increase in aggregate investment. The resulting expansion of firms’ production capacities lowered their marginal costs. These disinflationary supply side effects dominated over the inflationary effects induced by the stimulus to aggregate demand. At the ZLB, the concomitant rise in real interest rates, in turn, induced a net fall in aggregate consumption.

Chinese Multinationals Gaining Global Dominance

Chinese firms have become key players in the global economy. Their rise is a defining feature since the turn of the century. In this paper, we analyze the ascent of Chinese firms in global business, the factors behind their emergence and how they have disrupted the global competitive landscape. Through the empirical study of large samples of firms and the help of databases like Capital IQ, FdI Markets and SDC Platinum, the paper examines the revenue growth and global expansion of Chinese firms– highlighting, among others, trends in geographical and sectoral distribution and modes of entry in foreign markets. The paper pays also particular attention to the rise of Chinese firms as global innovators and includes several cases studies in key industries. The paper concludes that while Chinese firms’ global expansion benefited from a favorable global environment, the current trade wars and geopolitical tensions, may be more challenging.

Establishing Consumer Trust Through Data Protection Law as a Competitive Advantage in Indonesia and India

Data protection laws play a crucial role in enhancing consumer trust in the digital economy, especially with the rise of online cybersecurity threats due to firm expansion. Despite advances, personal data protection laws remain controversial globally, with challenges in implementation hindering progress in some regions. This research examines the competitive advantage of building consumer trust through the Personal Data Protection Law. This research uses juridical-normative research with a legislative approach and comparison with other countries. A comparison was made with India, one of the countries with higher awareness of the importance of personal data protection laws than other countries. The results show that Consumer trust in a company is measured by the extent to which they believe the company will protect their data. Public privacy policies and government regulations that enforce data security measures and increase transparency positively impact trust by reducing concerns about privacy risks. Although data protection laws have been introduced, obstacles such as lack of legal assistance and overlapping sectoral regulations still exist, hindering the smooth implementation of these laws. Nevertheless, implementing data protection laws, such as Indonesia's Private Data Protection Law No. 27 of 2022 and India's Digital Personal Data Protection Act of 2023, is crucial for boosting consumer confidence and regulating data processing. Data security is critical in establishing and maintaining consumer trust in companies as online cybersecurity threats increase with business expansion.

U.S. Market Concentration and Import Competition

Abstract Many studies have documented that the sales concentration of U.S. producers has risen in recent decades. In this article, we show that this increase was accompanied by more entry and growth of foreign competitors. Using confidential census data covering the universe of all firm sales in the U.S. manufacturing sector, we find that rising import competition increased concentration among U.S. firms by reallocating sales from smaller to larger U.S. firms and by causing firm exit. However, this increase in production concentration was counteracted by the expansion of foreign firms, which reduced domestic firms’ share of the U.S. market inclusive of foreign firms’ sales. We find that once the sales of foreign exporters are taken into account, U.S. market concentration in manufacturing was stable between 1992 and 2012.

Entry-Level Export Strategies in Developing African Countries

Considering Nigeria as an economically and demographically viable target market, this study examined entry-level export strategies that could facilitate the expansion of foreign firms to the Nigerian market. It was necessitated by the intricacies experienced by foreign companies in obtaining credible information about the Nigerian market for internationalization decision-making. The study adopted a narrative literature review design, relying on experiential insights and secondary data obtained from government and industrial sources in Nigeria to obtain the information presented in the investigation. An in-depth content analysis method was used to analyze the secondary data obtained for the study. From its findings, it was revealed that Nigeria is a profoundly viable export destination for a wide variety of foreign products including consumer electronics, ICT accessories, fashion, cosmetics and smartphone accessories. Nevertheless, the country’s volatile economic condition poses substantial risks for foreign companies in terms of foreign currency fluctuations; but using an export strategy, these risks can be considerably mitigated. This indicates the need for careful and deliberate export planning before entry into Nigeria to ensure that exporters familiarize themselves with information and knowledge of the workings of the Nigerian market. To this end, we recommend that intending export companies should carefully select suitable market segments they can consistently serve; they should also ensure to obtain all necessary certifications and permits from key agencies like the Nigeria Customs Service (NCS), National Agency for Food and Drug Administration and Control (NAFDAC), and Standards Organization of Nigeria (SON) to ensure smooth operations; and in terms of export entry option, we recommend a hybrid approach (direct and indirect exportation), which avails companies the opportunity of using local expertise and network to achieve effective distribution while maintaining strong control over their products.

Which ‘globalisations’ explain the overseas expansion of Chinese multinational enterprises through city-networks?

This paper analyses the overseas expansion of Chinese multinational enterprises using city-network analysis, with the focus on identifying the ‘globalisations’ that influence Chinese firm expansion. Applying a stepwise regression model to explain the world city networks of Chinese multinational enterprises (CMNEs), we find that variables linked to political, infrastructural, economic and cultural attributes explain the overall network. We then analyse in detail the connectivities produced by CMNEs in four main economic sectors: advanced producer services (APS), general services (GS), manufacturing (MF) and building, energy and mining industry (BEM), finding evidence of multiple, overlapping globalisations across sectors. This conforms to intensive globalisation in APS, extensive globalisation in GS and MF, and politically oriented globalisation in BEM, driven largely by Belt and Road, and related initiatives. The state presence in CMNEs’ overseas expansions suggests that globalisation by firms is tied to state-led globalisation objectives in some contexts, which complements the narratives that cast firm-led globalisation as market-oriented and stateless.

Fast growth and slow policy: a decade of digital credit in Kenya

Abstract The proliferation of mobile enabled instant credit products (digital credit) across emerging markets and developing economies poses challenges for policy-makers and practitioners that seek to expand access to credit while protecting consumers. The Kenya market, which experienced tremendous commercial innovation and growth from 2012 to 2022, but also significant consumer harms and unequal competition, offers a valuable reference case for actors in other markets facing rapid expansion of new fintech products and firms. Despite the substantial and often polarized debate around the country’s experience, there has been little systematic effort to capture and interpret key facts from the development of the digital credit market in Kenya during its first decade. This paper aims to fill that gap by providing a policy case study informed by original interviews of key stakeholders and extensive review of related academic and grey literature. The analysis suggests that policy responses were often inadequate to address the growing risks in Kenya’s digital credit market and presents five policy reflections from Kenya’s experience to support consumer protection and competition in emerging digital credit markets.

Surviving Competition: Neighbourhood Shops versus Convenience Chains

Abstract Hundreds of millions of microenterprises in emerging economies face increased competition from the entry and expansion of large firms that offer similar products. This paper examines the impacts of the opening of chain-run convenience stores on one of the world’s most ubiquitous microenterprises: owner-operated shops. To address endogeneity in time and location of chains’ opening, I pair two-way fixed effects with a novel instrument that shifts the profitability of chains but not of shops at the neighbourhood level. Expanding the number of chain outlets from zero to the neighbourhood average of 6.7 stores reduces the number of shops by 15%, a decline driven not by increased shop exits but by decreased shop entries. Shops retain their sales of fresh products and keep 96% of their customers, but customers visit shops less frequently and spend less on packaged goods. Surviving shops leverage competitive advantages stemming from being owner operated, such as lower agency costs, cultivating relationships with neighbours, and offering customers informal credit. The welfare gains of convenience chains replacing shops increase with household income; the poorest households experience a welfare loss.

Venture capital and high-tech start-ups in Europe: a systematic review of the empirical evidence

ABSTRACT Empirical literature on venture capital (VC) and VC-related policies posit that VC can play a major role in helping high-tech start-ups grow and innovate. Motivated by the VC policies recently adopted in Europe and by the heterogeneity of the VC effects across countries and regions, we assess this hypothesis in Europe. Using systematic literature review methods, we summarize the results of 34 firm-level studies published between 2000 and 2023 that estimate value-added effects of VC on funded firms in 17 European countries. The results show a clear preponderance of positive effects on firm expansion and investment. The evidence on the effects on innovation and productivity is more limited and mixed. Regarding the channels of these effects, there is considerable evidence that VC reduces credit constraints of funded firms and limited, but supportive, evidence that VC reduces other barriers to growth. The type of VC emerges as a key moderating factor. Private, independent VC tends to have the largest effects. Government VC tends to have lower, but positive, effects and it often complements private VC. Based on the results of the review and on the current landscape of VC in Europe, we provide recommendations for policy and future research.

Anesthesiologist shortage in the United States: A call for action

Anesthesiology is a vital component of modern healthcare. The United States is facing a shortage of anesthesiologists complicating the ability of hospitals and surgical specialties to meet the ever-growing demand. Recent local crises demand a reexamination of the issues. This shortage is complex and multifactorial, with causes on both supply and demand sides. The lack of sufficient graduate medical education funding for residency positions, changes in practice patterns and the aging and retiring workforce are limits to the supply. Increasing demand for surgical services will continue to rise by 2–3% per year over the next decade fueled by population growth, particularly among the elderly with the number of people 65 and older growing by 55% over the next decade. The problem of anesthesia supply and demand is complicated by the rapid expansion of private equity firms into the market. The effect is potentially increased cost and an alteration in the standards of care. While there are short-term solutions that can be adopted, such as hiring temporary help and expanding the role of mid-level providers, long-term solutions require a collaborative effort between healthcare providers, administrators, and policymakers to ensure that decisions are based on the best interests of patients and providers.

The Impact of Trust on Intra-Industry Resource Allocation and Aggregate Variables

This paper explores the relationship between firm expansion and job creation, focusing on how it contributes to overall income growth. It highlights the crucial factor of profitability in entrepreneurial decision to expand their firms. Various influences on this decision are discussed, with emphasizing trust. The paper argues that the dynamism of small firms plays a role in shaping the endogenous distribution of firm sizes. Trust is identified as a significant determinant of this dynamism. Employing a monopoly-competition model, the paper demonstrates that higher-ability entrepreneurs tend to select firm expansion. The model predicts a distinct pattern in the distribution of firm sizes, characterized by a cut-off point where entrepreneurs are classified. When the trust level is higher, entrepreneurs have greater incentives to expand their firms, resulting in a larger population of large firms and increased aggregate income. The paper concludes with a policy implication, suggesting that governments should strive to create a higher level of trust conducive to firm expansion if their objective is to boost aggregate income. Overall, this paper contributes to the existing literature on entrepreneurship and firm-size distribution.

The environmental benefit of tax enforcement: evidence from China

ABSTRACT This study explores how tax enforcement contributes to the improvement of air quality. We leverage the implementation of the Golden Tax Project III in China as a quasi-natural experiment and employ a difference-in-differences framework to establish causality. The findings indicate that the average SO2 concentration in pilot cities decreased by 2.8%, and the average PM2.5 concentration decreased by 3.2%. Further analysis reveals that curbing the expansion of tax-evading firms and ensuring the government’s provision of environmental public goods are mechanisms through which stricter tax enforcement reduces air pollution. These effects are more prominent in cities characterized by a higher proportion of heavy-polluting industries, greater fiscal pressure, and a stronger preference for environmental governance.

EFR Empirical Brilliance in Employment Strategies: Orchestrating Firm Stature, Exquisite Labor Proficiency, and Exponential Productivity in Confluence with Discerning Leverage and Enriched FDI Share

This study endeavors to scrutinize the veracity of Gibrat's law pertaining to the expansion of firms at the micro-level and explores the determinants of firms’ growth by employing datasets from emerging nations from 2004 to 2021. The study used panel unit root tests to scrutinize stationarity and system GMM to tackle endogeneity and unobserved heterogeneity. Overall, the findings of this study provide empirical support for Gibrat's law in the context of privatized banks in developing nations. Furthermore, the outcomes indicate that globalization and integration have posed considerable challenges for firms seeking to grow in developing countries that have implemented privatization policies. These conclusions suggest that certain elements, apart from size and sector growth, play a significant role in the evolution of a firm's growth trajectory. Nonetheless, the scope of this study is restricted to the evaluation of privatized banks in developing countries, and it does not delve into the specific methods of privatization utilized. Future research should explore diverse cohort sizes and expand the literature to address micro-level intricacies.

Market structure, resource allocation, and industry productivity growth: Firm-level evidence from China's steel industry

Regional monopoly limits market reforms from improving cross-firm resource allocative efficiency, but little empirical evidence is available from developing countries. This paper provides rich evidence that regional monopoly may hinder the expansion of more productive firms, using the Chinese iron and steel sector as a case. Drawing on a comprehensive panel dataset comprising 11,136 iron and steel firms in China from 1998 to 2009, we demonstrate that market reforms in China's steel industry enhance competition at the national level, but do not effectively improve resource reallocation within provinces. Despite a decline in the market share of the top 10 largest steel enterprises from 80% to 50% between 1998 and 2009, resource reallocation only contributes to 14% of industry-level total factor productivity (TFP) growth, amounting to one-sixth of the contribution from within-firm productivity growth. Furthermore, the effects of resource reallocation within provinces are significantly lower compared to those observed between provinces, suggesting that market fragmentation or frictions hinder the expansion of more productive firms within the same province. These findings underscore the importance of eliminating regional monopoly for developing countries undergoing market reforms to enhance resource allocative efficiency.

The Impact of Localized Co-branding on Consumers Purchase Intention

With the rapid expansion of local beauty firms in China, multinational makeup brands face an increasing threat. To attract more consumers, certain global beauty firms operating in China have adjusted their business models, deciding to form alliances with competitive local Chinese brands. Based on this market phenomenon, this paper decided to use Shiseido as an example to explore how cross-border co-branding cooperation between international cosmetics brands affects consumers purchase intentions. This paper utilized qualitative research methods to conduct a SWOT analysis of aromatherapy products jointly launched by Shiseido and To Summer from the perspective of marketing mix theory. The conclusion was that the cross-border cooperation of international cosmetics brands has a positive effect on the purchase intention of consumers, and from a product point of view, Shiseidos strict control of product quality accelerates consumers purchase of fragrance. In addition, Shiseidos diversified marketing strategy on media platforms has an incentive effect on consumers purchasing power. Conversely, Shiseidos higher product pricing than local brands and lack of distribution channels for aromatherapy products will reduce consumers purchasing power.

Emerging trends of green hydrogen and sustainable environment in the case of Australia.

The world faces immense pressure regarding the negative impacts of increased greenhouse gas emissions, climate change, global warming, droughts, and many other environmental problems. Australia is also facing the same issues and requires urgent attention. In this research, we have examined the effect of hydrogen firms on Australia's greenhouse gas emissions. We employed the monthly data from January 2002 to December 2021 for econometric estimations. Through quantile regression, it is noted that the expansion of hydrogen firms contributes to environmental pollution instead of controlling the emissions. Most hydrogen energy still emits carbon dioxide, which contributes to climate change. Around the world, carbon-containing fossil fuels produce more than 95% of hydrogen energy. However, as a policy suggestion, it is recommended that green hydrogen produced by electrolysis of water using renewable energy sources will succeed in achieving the Sustainable Development Goals (SDGs).

Economic Inequality And Its Effects On The Decision-Making Of Entrepreneurs In Emerging Economies

Economic inequality additionally influences entrepreneurial decision-making through interactions with social and institutional variables. Entrepreneurs in nations with extreme inequality confront extra difficulties, such as restricted access to formal institutions, mentorship, and networks. These elements have an impact on their strategic decisions, which include collaborations, financial sourcing, and involvement with governmental organizations. Understanding how economic disparity affects how entrepreneurs make decisions has significant ramifications for both the development of specific companies as well as the entire economy in emerging nations. The success, expansion, and resiliency of firms can be affected by the choices made by entrepreneurs as a result of economic inequality. Businesses may increase their productivity, provide job opportunities, and support economic growth by tackling the problems caused by economic inequality through inclusive policies and creative tactics.