• The Journal of Asian Finance, Economics and Business
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• v.8 no.4
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• pp.289-306
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• 2021

This paper aims to investigate how and to what extent FDI impacts the relative demand for skilled labor within firms in the case of developing countries. The analysis uses a sizeable micro-level dataset for Malaysian manufacturing industries using the System-GMM estimators to control the estimations' endogeneity problems. For this purpose, the study uses foreign equity share at the firm level to investigate foreign ownership effects at the firm level and the Horizontal FDI index by Smarzynska Javorcik (2004) to analyze FDI intra-industry linkages influence on the structure of labor demand for Malaysian domestic firms. Our findings indicate that foreign ownership increases the skilled demand within Malaysian manufacturing through the learning process, exclusively for small- and medium-sized firms (SMEs). Conversely for foreign-owned firms, changes in their skilled-labor share do not associate with changes in firm-level foreign equity share. We conclude that foreign ownership per se is not the major contributing factor for skill upgrading in Malaysian manufacturing firms. Furthermore, the competitive pressures caused by foreign firms' presence within the same industry - namely horizontal FDI - has a significant negative spillover effect on the level of skilled-labor share for domestic firms in the Malaysian manufacturing sector within periods of the understudies.

• The Journal of Asian Finance, Economics and Business
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• v.6 no.3
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• pp.131-140
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• 2019

The study aims to examine the impact of productivity in addition to the policy of increasing the foreign investors' ownership rate on the performance of businesses which were listed on Vietnam's stock exchange market from 2010 to 2017. With the database of 3.961 observations, the study employs a statistical method - multiple regression to estimate the relationship between labor productivity, foreign ownership as well as other firm-level characteristics and firm performance. Research findings show that increasing labor productivity and increasing foreign ownership rates help increase firm performance. In addition, except for financial leverage, variables such as liquidity and firm size have positive effects on firm performance measured by Tobin's Q. These findings have theoretical contributions and practical implications for managers, investors and government in Vietnam. Managers should pay attention to improving labor productivity through employing incentive mechanisms, building a good working environment, investing in technology, etc. in order to enhance the firm performance. Investors could utilize the labor productivity and foreign ownership indicators to select stocks of good companies for investment. For Vietnamese government, relaxing the limit of foreign ownership and accelerating the divesting of State capital in State-owned enterprises could help increase the investment scale of foreign investors and resulting in positive effects on the firm performance.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.9
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• pp.409-418
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• 2020

The human and capital resources from foreign investors are important sources of finance for developing countries. Foreign ownership can help the firm to raise funds for operations and the foreign management can help the firm expand the market and improve management. However, does this really happen to Vietnamese firm? To find the answer to that question, this paper examines the impact of foreign ownership and management on the financial performance of listed firms on Vietnam's stock market. The data collected include 427 listed firms in all fields over five years, from 2014 to 2018. The financial performance is measured by Tobin's Q, ROA and ROE. The study carried out testing of each model by the least squares method of Pool OLS, assessing random effects (REM) and evaluating fixed effects (FEM). The most effective model is the FEM model. The results show that the foreign ownership ratio and the size of the firm have a positive impact on the financial performance. The foreign management, the age of the firms, the liquidity and financial leverage have a negative impact on the financial performance. Based on the research results, the study proposes some recommendations to improve the financial performance of listed firms in Vietnam.

• Journal of Korea Port Economic Association
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• v.31 no.3
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• pp.41-60
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• 2015

This paper investigates whether managerial ownership and foreign ownership have impacts on firm value, using a sample of logistics firms listed on the Korea Stock Exchange between 2008 and 2014. In the Korean economy, family-controlled business groups, known as chaebol, constitute a unique governance system. To acquire investments from controlling shareholders, a logistics firm is likely to be included in family-controlled business groups. Since reform of the governance structure of logistics firms in the South Korea enables shareholder value to be maximized, we analyzed ownership effects on firm value using pooled ordinary least squares. Empirical results showed that there was a significant positive relation between managerial ownership and firm value. This study also found that there was a significant positive relation between foreign ownership and firm value. We thus show that both managerial ownership and foreign ownership can protect shareholders by positively affecting firm values.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
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• v.24
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• pp.107-125
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• 2004

This study is based on the survey data of 74 Korean multinational corporations, which undertook foreign direct investments from 1980 to 1996. The study examined the firm-specific as well as the host country-specific factors affecting the decision between shared and full ownership. According to the results of this study, as for the firm-specific factors, Korean firms entering foreign markets in order to penetrate local markets prefer shared ownership while those pursuing core business diversification prefer full ownership. As for the host country factors, the more advanced the host country(such as OECD countries) is, the more preference is given to full ownership.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.12
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• pp.183-189
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• 2021

Transfer pricing is a matter of concern for countries. It affects the interests of the parties involved in the commercial transaction. Through manipulation of prices in transactions, businesses take advantage of tax rates in a country to adjust profits for economic gain. This affects the fairness and rationality of economic transactions between related parties. The article uses a two-year time series from 2018 to 2019 of 50 foreign direct investment enterprises in Vietnam. The article uses ordinary least squares to test the hypotheses of the research model. The article uses four independent variables related to ownership structure affecting transfer pricing decisions including total ownership, organization ownership, concentration ownership, and area ownership. Research results show that two variables have a positive influence on transfer pricing decisions including total ownership and organization ownership. Organization ownership has a higher degree of influence than total ownership. To be able to control transaction activities related to transfer pricing, Vietnam's state management agencies need to pay attention to perfecting the legal framework based on supplementing and amending regulations related to transfer pricing. Legal regulations need to be regulated based on international common practices to ensure uniformity on a global scale.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.9
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• pp.159-168
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• 2020

This is a quantitative research, underpinned by the philosophy of natural science and deduction approach that examines the impact of the various aspects of corporate governance mechanism on the choice of capital structure of Vietnamese listed firms. We focus on the effect of factors such as the board size, the board independence, and especially different ownership structures, which include the managerial ownership, the state ownership, the concentrated ownership, and the foreign ownership. They are the main scopes of corporate governance and are supposed to be relevant to determine the corporate financing choice. To explain the causal relationship between factors, we construct the regression model and then test it by using different statistical method approaches, including the pooled OLS, the fixed effects model, and the random effects model. Data are collected from 336 firms with shares listed in the Ho Chi Minh City Stock Exchange in Vietnam, totaling 1583 observations. Overall, the results reveal that the board size, state ownership, and concentrated ownership have positive impact on the firm's capital structure, whereas foreign ownership appears to have negative influence on the capital structure. The research does not find evidence of a the correlation between board independence, managerial ownership and corporate capital struture.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.7
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• pp.245-254
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• 2021

This paper examines the impact of corporate governance strength on capital structure in an emerging country, namely, Jordan, by constructing a corporate governance score that captures both internal monitoring mechanisms (foreign ownership and institutional ownership) and external monitoring mechanism (audit fees). In addition, this study uses profitability as control variable. This paper uses data of non-financial companies (industrial and services) of 87 listed firms on Amman Stock Exchange (ASE) from 2011 to 2019. Using the random-effects generalized least square (GLS) regression model, the findings reveal that foreign ownership significantly and negatively influences the level leverage, while institutional ownership has a positive and insignificant association with level leverage. Further, audit fees have a positive and strong significant association with level leverage in Jordan. In addition, profitability has a positive and significant association with leverage. These outcomes suggest that foreign ownership should be encouraged in listed companies as it can replace the weakness of other corporate governance mechanisms in Jordan. The outcomes of the current study should be of great interest to regulators and policy-makers. The results, which are robust to a range of alternative proxies and to additional tests, provide new insights into the determinants of level leverage.

• Analyses & Alternatives
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• v.4 no.2
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• pp.39-70
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• 2020

This paper examines the changing roles of ownership in the economic growth by using a panel data set of 30 provinces in China for the period (1999-2010). With the use of absolute and relative presence variables, this study shows that private enterprises have emerged as the engine of economic growth in China in the later period (2005-2010). The growing size and number of private enterprises are positively linked to growth. However, though foreign-invested enterprises have been acclaimed as the main contributors to economic growth in China, they have minimal effect on the economic growth in the later period. State-owned enterprises have a significant and negative effect on the economic growth in the later period. The results can be interpreted that the engine of growth in China has been changed over time from other ownerships to private ownership. Private companies have developed a lot in every respect and started to lead the economy for long-run growth. China initiated its economic growth by adopting foreign capital and it is still the top destination for foreign direct investment among developing countries. However, to sustain the growth over a long period, private sector should be of great importance and perform a key role in the view of catch-up economics.

• Journal of Korean Institute of Industrial Engineers
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• v.36 no.3
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• pp.186-192
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• 2010

The present study classified the auto-parts makers into four groups according to their investment ownership. Four groups consist the one fully owned by Koreans, the one fully owned by foreigners, the one owned less than 100% but more than 50% by foreigners, lastly the one owned by less than or equal to 50% by foreigners. Among these, the auto-parts makers, 100% foreign ownership, have the highest Malmquist productivity index while 100% Korean-owned part-makers has the lowest productivity. In case of the 100% foreign ownership companies, the cause of Malmquist change, however, is attributed to the technical efficiency change. In particular, the pure technical change is the main source of the Malmquist change. This may indicate that the 100% foreign-owned companies have successfully transferred their production process technologies to the Korean plants. They are enjoying so called the "imitation-effect." 100% Korean-owned companies were not able to create the "imitationeffect" and therefore failed to close the gap with the foreign-owned companies in terms of the production efficiency. 100% Korean-owned auto-parts makers, however, outperformed the foreign-owned companies in the technological change. The outstanding technological change may indicate that Korean-owned part makers were able to narrow the gap with the foreign-owned companies in the area of engineering technological capabilities. The same results were also observed for 50% foreign-owned companies. Knowing that the core competence of the auto-parts makers lies on the engineering technological capabilities, the research found that the most desirable form of the foreign investment was 50% of foreign ownership.