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Born global firms in knowledge intensive business services (KIBS): what do we know of their performance?
KTH, School of Industrial Engineering and Management (ITM), Industrial Economics and Management (Dept.), Economics.
(English)Manuscript (preprint) (Other (popular science, discussion, etc.))
Abstract [en]

This paper studies the performance of KIBS firms that are aimed for global markets from inception. Despite the increasing importance of KIBS, no previous study has investigated born global firms in this sector of the economy. Three definitions are used to categorize firms as born global. Both OLS and a nearest neighbor matching approach are implemented to find evidence of higher growth in employment and sales per employee five years after firm foundation. Finally, the findings are robust to a finer array of born global definitions and time horizons of firm performance.

Keyword [en]
Born global firms, firm performance, knowledge intensive business sector
National Category
Social Sciences
Identifiers
URN: urn:nbn:se:kth:diva-89657OAI: oai:DiVA.org:kth-89657DiVA: diva2:503221
Note
QS 2012Available from: 2012-02-15 Created: 2012-02-15 Last updated: 2012-02-15Bibliographically approved
In thesis
1. Firm internationalization and born global firms: On the causes and consequences of export market entry
Open this publication in new window or tab >>Firm internationalization and born global firms: On the causes and consequences of export market entry
2012 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

The thesis consists of four self-contained essays on the topic of small firm internationalization. In the first essay I study the relationship between collateralizable assets and export market entry. There are often large sunk costs associated with export market entry, which firms have to finance somehow. A firm‘s access to external finance is therefore proxied by its collateralizable assets. These collateralizable assets are used as securitization in the firm‘s loan applications. The main finding of the paper is that tangible assets, i.e. assets with high collateralizable value, are an important determinant of export market entry.

The remaining three essays study born global firms. The thesis‘s second essay is on the performance of manufacturing born global firms. Born global firms have previously been studied predominantly using qualitative methods instead of a quantitative approach as is done in this essay. Four different performance measures are used and evidence is found that born global firms perform superior five years subsequent to firm foundation when performance is measured by employment and sales per employee. However, for profitability and labor productivity no such effect can be identified. The OLS results are confirmed by a nearest neighbor matching approach, which shows similar results.

The focus of the third essay is on a subset of KIBS firms that can be categorized as born global firms. In many economies, the role of KIBS has increased over the past couple of decades. Despite this fact, there has been little attempt to describe the sector‘s export activities. This paper studies the performance of born global KIBS firms. The paper is very similar to the second essay, but due to the heavy focus on manufacturing firms in studies of born global firms, KIBS firms deserve a separate treatment. The findings indicate that born global KIBS firms perform better in terms of employment growth and sales per employee. These findings are robust to different born global definitions and time horizons of firm performance.

The fourth essay investigates whether employee characteristics matter for firm survival. The focus of the paper is on born global firms both within the manufacturing and KIBS industries. The methodology of choice in studying firm survival is the Cox proportional hazard models. The results show little significance of individual employee characteristics as determinant for survival rates when born global firms are investigated. Furthermore, neither spinouts nor firms categorized as future exporters show much significance on individual characteristics. However, when the sample is extended to include the total amount of new firms, we see that individual employee characteristics do matter for survival.

Place, publisher, year, edition, pages
KTH, 2012. 10 p.
Series
Trita-IEO, ISSN 1100-7982 ; 2012:01
Keyword
categorized as future exporters show much significance on individual characteristics. However, when the sample is extended to include the total amount of new firms, we see that individual employee characteristics do matter for survival.
National Category
Social Sciences
Identifiers
urn:nbn:se:kth:diva-87652 (URN)978-91-7501-262-9 (ISBN)
Public defence
2012-03-07, F3, Lindstedtsvägen 26, KTH, Stockholm, 13:00 (English)
Opponent
Supervisors
Note
QC 20120215Available from: 2012-02-15 Created: 2012-02-14 Last updated: 2012-02-15Bibliographically approved

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