Firms must access capital to remain in business.  Small firms have greater difficulty accessing financial resources than have large firms because of their limited access to capital markets.  These difficulties are exacerbated by information asymmetries between a small firm’ s management and capital providers.  It has been theorized that many information asymmetries can be reduced through networks that link those in need of capital with those who can supply it. This research is about these relationships and their impact on the firms’ capital structure. This research has been limited to a sub-set of small firms, family firms.  I have collected data through a survey using a systematic sampling procedure. Both self-administered questionnaires and semi-structured interviews were utilized. The data analysis was based on the responses from two-hundred-and-fifty-six small manufacturing firms in Thailand. Seemingly unrelated regression (SUR), logistic regression, multiple discriminant analysis and Mann-Whitney U test were employed in the analysis. The hypothesis that firms apply a pecking order in their capital raising was confirmed although the generally accepted rationale based on poor access (and information asymmetries) was rejected.  Instead, at least for family firms, the desire to maintain family control had a significant impact on the use of retained earnings and owner’s savings. My results also indicated that while the depth of relationships had a positive effect on direct funding from family and friends, networks did not facilitate capital access from external providers of funds. Instead direct communications between owner-managers and their capital providers (particularly bank officials) mattered. A comparative analysisof small manufacturing firms in general and small family manufacturing firms revealed that there were differences between them in regard to their financial preferences, suggesting that family firms should be considered separately in small firm research. Further, the results of this research raise some questions about the appropriateness of applying theories directly from one research context to another without due consideration for  the impact of cultural influences. Through this research I have added evidence to the dialogue about small firms from a non-English speaking country by investigating the impact of networks on capital structure and the rationale behind family firm capital structure decisions.

The topic of the effects of audit quality as a consequence of audit firm rotation has been debated for decades in business science. It has also been discussed in the political arena. In April 2013 the Legal Affairs Committee of the European Union voted for a draft law requiring mandatory audit firm rotation for periods of 14 years. Countries such as Sweden might face the possible changes in audit quality that the mandatory audit firm rotation entails. In the light of these events, we studied how the audit quality changes when audit firms rotate. Because we used the Jones Model and the Modified Jones Model, discretionary accruals were our proxy for audit quality. The initial sample consisted of all publicly listed companies which rotated audit firms from 2008 to 2012 in Sweden. We found that there was a statistically significant change in audit quality, in the form of higher discretionary accruals following the rotation. Based on earlier research claiming that higher discretionary accruals signifies lower audit quality, our results suggest that audit firm rotation in Sweden leads to a diminished audit quality. This might be due to the loss of firm-specific knowledge. Our results also indicate that the new auditing firms are more conservative than the auditor firm prior to the rotation, which might be explained by the increased audit risk that is related to the audit of the first-year client.

This thesis examines to what extent the firm size influences on firm growth and their behaviour of Spanish manufactures and service industries between 1994 and 2002 from the stochastic growth theory. The study has not only responded to the need of considering firm size as a key variable for future firm growth, but it has also examined the impacts of different industries for the development of firms, the learning process and the impact of internal and external firm characteristics. The firm growth is the process affecting firms while they remain active in the market. While some theories justify the firm growth as an adjustment of size due to internal or external environment, others have justified the change of size as a response to luck factors.To analyse it we have based on Gibrat's Law or Law of Proportionate Effects. Gibrat's Law suggests that all firms have the same probability to grow independently of their size. Although the researcher's interest to analyse it there are some mix results in the literature and there are still some lacks in the literature. According to the empirical review of the Gibrat's Law, several are the results to be stood out. Firstly, the firm growth is a complex process affected by internal and external characteristics which may be due to deterministic or random factors. Secondly, there appear some outstanding lacks of empirical studies. On the one hand, there are few empirical studies analysing the service industries. On the other hand, there is a scarcity of researchers incorporating the spatial dimension in their analysis.Our results refuse Gibrat's Law both for manufactures and service industries and, more interestingly, those results do not vary when introducing the firm learning process in the market. In reference to the differences between each individual sector, there appear different growth behaviours depending on the industry. It is well known that the firm growth pattern depends on the characteristics of industry and our results show a different behaviour depending on the industry. Therefore, if we consider different sectors, the firm growth pattern presents a heterogeneous trend. Each industry has quite different technologies and perhaps different growth processes, which might explain the mixed nature of the results.The persistence of firm growth offers a dynamic approach to the growth pattern. The relationship between past and current growth rates have been another aspect related with Gibrat's Law. The persistence of firm growth is highly important for policy-makers and managers, who should consider the pattern driving firm growth in order to increase the profitability of their investments, the job creation and the economic growth. As it was expected, the effect of the persistence depends on the proximity of the growth. In other words, a positive growth will have more impact on the following period than two periods later. Related to the analysis of the presence of different equilibria of firm growth, our results show that there is a significant difference in growth between manufacturing and service sector firms which persist when controlling for other firm specific characteristics. Nevertheless, the introduction of the location variables generates that those different trends are not significant. In order to know how important the differentiation between manufactures and service industries is, we estimate Gibrat's Law for manufactures and service industries in separate equations. When we separate the estimation of both industries, our results accept that the equilibria are different including the locational variables.In reference to the determinants of firm growth, variables such as the territorial R&D and the growth of GDP have positive externalities to firm growth. On the other hand, the industrial diversity or specialisation present different results depending on the sector. Finally, barriers to entry such as capital intensity and minimum efficient size behave as barriers to grow. That means that sectors which are highly capital intensive, they will prevent firms from growing. Conversely, sectors with low barriers to entry have low barriers to grow. However, those barriers to grow may be surpassed with internal characteristics such as innovation, cooperation, increase of human capital, etc. / Aquesta tesis examina la influència de la dimensió de l'empresa en el creixement empresarial, així com el comportament de les manufactures i els serveis d'Espanya entre 1994 i 2002 des d'una perspectiva estocàstica. Aquesta tesis no només respon a la necessitat de considerar el tamany de l'empresa com una variable crucial per al futur de l'empresa sinó també les característiques sectorials, el procés d'aprenentatge i les característiques internes i externes. El creixement empresarial és el procés que afecta a les empreses mentre estan actives en el mercat. Mentre que algunes teories justifiquen el creixement de l'empresa com un procés d'ajust cap al tamany òptim, altres teories justifiquen el creixement a un conjunt de factors aleatoris. Per tal d'analitzar el creixement empresarial, ens basem en la Llei de Gibrat o Llei dels Efectes Proporcionals. Llei de Gibrat suggereix que totes les empreses tenen la mateixa probabilitat per créixer independentment del seu tamany. Tot i l'interès del tema, els resultats en la literatura empírica són contradictoris i existeixen encara alguns buits. D'acord amb la revisió empírica de la Llei de Gibrat, diferents resultants poden ser destacats. En primer lloc, el creixement empresarial és un procés complex que depén de característiques internes i externes que poden afecten de forma determinística o aleatòria. En segon lloc, hi ha varies buits en la literatura. Per una banda, pocs estudis empírica analitzen els serveis. Per altra banda, hi ha una escassetat d'investigadors que incorporen la dimensió locacional.Els nostres resultats refusen la Llei de Gibrat per les manufactures I els serveis i, a més a més, aquests resultats no varien quan introduïm el procés d'aprenentatge de l'empresa en el mercat. Quant a les diferències entre cada sector individual, apareixen comportaments de creixement diferents en funció de la indústria. És un fet conegut que el creixement de l'empresa depèn de les característiques de la indústria i els nostres resultats mostren un comportament diferent en funció del sector industrial. Per tant, cada indústria té diferents característiques tecnològiques i diferent processos de creixement, els quals poden explicar els resultats contradictoris de la literatura.La persistència del creixement empresarial ofereix una perspectiva dinàmica del creixement de l'empresa. La relació entre creixement passat i actual és un alter aspecte relacionat amb la Llei de Gibrat. La persistència del creixement empresarial és molt important per als agents públics i directors, els quals hauries de tenen compte el comportament que dirigeix el creixement empresarial per tal d'incrementar els beneficis de les seves inversions, la creació de l'ocupació i el creixement econòmic. Com era d'esperar, l'efecte de la persistència depèn de la proximitat temporal del creixement. En altres paraules, un creixement positiu tindrà més impacte en el període següent que dos períodes després. Quant a l'anàlisi de la presència de diferents equilibris de creixement empresarial, els nostres resultats mostren que hi ha una diferència significativa en el creixement entre els sectors manufacturers i els serveis la qual persisteix quan controlem per altres característiques específiques de l'empresa. No obstant, la introducció de les variables locacionals generata que aquesta tendència sigui no significativa. Per tal de saber com d'important és la diferenciació entre manufactures i serveis s'estima la Llei de Gibrat per a les indústries manufactureres i els serveis en equacions separades. En separar les estimacions d'ambdues indústries, els nostres resultats accepten l'existència de diferents equilibris quan s'inclouen les variables locacionals. Quant als determinants dels creixement empresarial, variables com la intensitat tecnològica territorial i el creixement del PIB presenten externalitats positives sobre el creixement empresarial. Per altra banda, la diversitat o especialització industrial tenen impactes diferents en funció del sector a analitzar. Finalment, barreres d'entrada com la intensitat del capital i el tamany mínim eficient es comporten com barreres al creixement. Això vol dir que sectors que són intensiu en capital dificultaran el creixement de les empreses. Pel contrari, sectors amb baixes barreres d'entrada tenen baixes barreres al creixement. No obstant, aquestes barreres al creixement poden ser superades amb característiques internes com la innovació, la cooperació, l'increment del capital humà, etc.

Entrepreneurship is the foundation of the economic for each country. It has an inevitable impact onmicro- and macro-economic factors such as GDP, economic growth, employment/unemploymentrate, regional development, etc. Thus, entrepreneurial practices are crucial for each country in orderto have better economic conditions.Growth is the dominant part of entrepreneurial practices from which the success of small firms canbe assessed and evaluated. Firm’s growth involves different aspects such as motives, finance andownership strategies, indicators, and growth stimulus. These factors together provide a pattern ofgrowth that is different from one company to another.Since the advent of the Internet there has been changes in the business world and the terms such asdotcom, digital entrepreneurship, e-services, e-banking, etc. made a dramatic change in the way ofdoing business. Some companies were established based on the Internet and their income andexistence relied on the Internet. Some others on the other hand, use traditional method of businessbesides using the Internet as an extra tool.This study examines the small business growth pattern in order to find out how small firms grow.Furthermore, the difference between the growth pattern of digital firms and traditional companies isexamined to find out how the pattern of growth differs from dotcoms to the brick-and-mortars.This study is based on a qualitative research method with the approach of a case study research. Thecase study is designed on one major case to go deep while having four other supporting companiesin order to get the best results with the least subjectivity. The questionnaire was designed on a semistructureand the results were coded for the pattern. The questions were designed based on theconceptual framework which was changes based on the results and optimized.The results from this study provide a framework that gives a pattern of growth for small firms. Thesuggested framework of growth pattern has some major components: growth motive, growthstrategy, growth indicator, and growth stimulus. Furthermore, the research findings define the majordifferences between the growth pattern of dotcoms and brick-and-mortars.

In this thesis we examined the export dynamics at the firm level. A two period model is proposed for the life of firms. The firms may have three different behaviors: staying out of markets, producing for the domestic market, and producing for both the domestic and the export markets. During two periods, firms may enter or exit the markets according to their expected) profits. All firms are profit maximizing such that they compare the maximum (expected) profits in the domestic and export markets. Firms are also heterogenous so that they have different levels of productivity. We examined changes in investment, market share and profits with respect to changes in the market and firm parameters. The profits and investments of the exporting and non-exporting firms are compared by both analytical and numerical methods.

SEW refers to the stock of affect-related values that an owning family derives from its family business. As a promising theoretical concept, the SEW has been used widely to explain the diverse strategic choices of family firms compared to non-family firms. However, little study has been done to measure SEW directly and to measure the effect of SEW on family firms’ strategic choices.     Within the context of family-owned Hidden Champions, this thesis study replicates the five-dimension model proposed by Berrone et al. in an empirical study to verify the psychometric measurement on the degree of SEW. Furthermore, internationalization has been chosen as an example to demonstrate the effects of SEW on family firms’ strategic choices and outcomes.   This study has verified the reliability and validity of the SEW scale and SEW’s five subscales constructed. Furthermore, the measurement on SEW and its five dimensions has been applied to examine the effects of SEW and its five dimensions on the internationalization of family firms. The findings reveal that SEW has a negative effect on the internationalization of family firms, which is mainly due to the negative effect of Family Control and Influence.

I propose that CEO employment history is an observable characteristic that reveals the CEO’s unobservable risk-taking preferences. I hypothesize that CEOs that change employers more frequently (mobile CEOs) have a propensity to bear risk and implement riskier firm policies. Using a sample of S&P 1500 CEOs, I find that firms are more likely to hire mobile CEOs when the firm’s prior risk is high, firm-specific human capital is less important, the prior CEO turnover is forced, the prior CEO has a shorter tenure and the board is smaller and has fewer insiders. Mobile CEOs increase financial leverage, invest more in advertising and less in capital expenditures, and increase firm-specific risk. Mobile CEOs invest more (less) in R&D in homogenous (heterogeneous) industries where firm-specific knowledge is less (more) important in making investment decisions. Shareholders react positively to appointments of CEOs who change employers more frequently. I find no difference in long-run accounting performance for CEOs with different employment histories. Firms’ annual stock returns and sales growth are higher for CEOs who change employers more frequently. The cost of debt increases after the firm appoints a mobile CEO. These findings suggest that lower CEO risk aversion and the potential risk-shifting from shareholders to bondholders are sources of shareholder value increases. In sum, my findings provide evidence that CEO employment history is an observable characteristic that reveals the risk-taking preference of the CEO.

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This study investigates the relation between family firms and acquiring firm performance for our sample of Taiwanese mergers and acquisitions between 1999 and 2013. We find that cumulative abnormal returns of family acquirers on average outperform those of nonfamily acquirers by 2.17% three days around the announcement. Family acquirers obtain greater abnormal returns even after controlling for both firm characteristics such as firm size, book to market, prior return, public target and deal characteristics such as year dummy and mode of payment. Furthermore, we explore the potential impact of the deviation between voting rights and cash flow rights on family acquiring performance. In the sample of Taiwanese mergers and acquisitions, the deviation is not the significant factor to cause a negative influence. As a result, family acquirers with the advantage of eliminating agency problems may generate more benefits than nonfamily acquirers.

This study provides a systematic description of the nature and evolution of major transactions in the U.S. apparel sector, using a theory that applies across sectors. This research investigates the determinants of the existence and magnitude of major inter-firm transactions, relying on a unique longitudinal dataset of over 2,000 of the largest transactional (buy-sell) relations between publicly traded firms in the U.S. apparel sector. The results indicate the importance of inter-firm complementarity, rather than inter-firm similarity, in explaining the sector architecture; thus contributing to the future improvement of industry classification systems. This study also contributes to a deeper understanding of the apparel sector focusing on the change in the relative importance of manufacturing activities versus service activities and in the involvement of firms from the outside apparel sector. Implications of inter-firm transactions are discussed regarding industry policies, and human and environmental welfare in manufacturing and raw materials industries.