We examine the financing choices of undiversified large shareholders or owner-managers in a continuous time structural model with rational expectations. The interplay between the objective of the undiversified, self-interested owner-manager who controls the firm and the valuation of the firms marketed claims by well-diversified outside investors, has a major impact on leverage and debt maturity choices as well as credit spreads. The effect of this interplay is particularly significant in a world where the representative investor (who determines asset prices in the economy) is risk-averse leading to nonzero market prices of systematic risk and risk premia of the firms investment opportunities. In a perfect information framework with no taxes or bankruptcy costs, we show that, the owner-manager could, depending on the projects characteristics, finance them exclusively with debt, exclusively with equity, or with a combination of equity and debt. Ceteris paribus, leverage increases with the expected growth rate of firm value under its investment opportunities, and decreases with its volatility. Debt maturity varies non-monotonically in a U-shaped manner with the expected growth rate, and decreases with the volatility. Our results reconcile empirical evidence on the variation of financing choices with firm characteristics that is not completely consistent with previous theories. The significant impact of the expected returns (therefore, risk premia) of firms investment opportunities on their leverage ratios, debt maturities, and credit spreads are important implications of our theory that cannot be obtained in these models or in models in which all agents are risk-neutral so that risk premia are zero. We empirically test the implications of our theory for the relationships among firms financing and debt maturity choices and the expected growth rate and volatility of their asset values. Controlling for all the significant determinants of firms financing and debt maturity choices identified by earlier studies, we show significant empirical support for our predictions.

Published Article / With the recent explosion of global marketing strategies, business enterprises have to contend with severe and escalating competition. To sustain competitiveness, small and medium enterprises (SMEs) in South Africa should produce high-quality, customised goods and services efficiently. Adoption of Internet marketing technologies is fundamental towards meeting this challenge. However, the adoption and diffusion of technologies in marketing practices is the outcome of purposeful processes emanating from the realisation by SMEs that adoption of these technologies yields significant paybacks. The purpose of this study was to establish the managers' perceptions of the benefits of Internet marketing adoption in small and medium enterprises. Using a quantitative approach, a questionnaire was administered to owner-managers of small and medium enterprises in the Vaal Triangle in South Africa. A total of 269 questionnaires were completed, returned and considered useful for the survey. Data were analysed using descriptive statistics and factor analysis in order to establish the factors considered to be the salient Internet marketing benefits. Four underlying factors were extracted namely: customer relationship building, information gathering, promotion and enhanced productivity. The mean scores indicated that information gathering was perceived as most important, but after sturdier tests for association were applied to the data set, customer relationship management demonstrated the most significant and positive correlation with SME productivity. As such, there is need for the small and medium enterprises to develop strategies to expand and sustain the identified benefits of Internet marketing.

To inquire into entrepreneurship, a newly-emerging and interesting subject, our research has selected Taiwan¡¦s information technology electronics components industry as research target. By gathering vast- and primary- data, and using several representative Taiwanese component manufacturers as case studies, we found the ¡¥technical-amateur¡¦ phenomenon. This paper will clearly explain the contents, contextual factors, and advantages of technical-amateur entrepreneurship. These type of entrepreneurs are so-called ¡¥technical-amateurs¡¦ because they lacked previous work experiences in the information technology industry, i.e. outsiders; they also lacked technical ability of the typical blue-collared workers and the engineers, they were previously high-level managers in the manufacturing industry. Thus technical-amateurs tend to have vast- and extended- relationship networks that can quickly transfer capitals, to form capital team and gain the assistance of venture capital to attract the technical team; they also have sharp intuition that can strategize to move toward the mainstream to maximize market benefits; they also have managerial ability that can successfully assimilate the technology team and improve production efficiency while reducing production cost. These concepts are similar to the arguments of ¡¥fitness landscape¡¦, ¡¥co-evolution¡¦, and ¡¥the establishment of shared schema¡¨. There are several important contextual factors that led to the emergence of technical-amateurs. 1) Product technology already exists, but the process technology remains to be explored; 2) Clustering of the local information technology industry, especially the existence of world-class EMS manufacturers; 3) Rapid growths of venture-capitals; 4) Mobility of technology and talents; and 5) Profitability minimization of information products. Comparing to technical entrepreneurs, technical-amateur entrepreneurs have the following advantages: 1.By occupying the advanced-guard position in the information industry, can quickly discover entrepreneurial opportunities. Outsourcing under changes in the global commodity chain and the trend toward lighter- and smaller- information products, give rise to more entrepreneurial opportunities in the component industry. Since technical-amateurs maintain close relationships with venture-capital thus can organize capital team, therefore occupying the advanced-guard position where they can quickly discover emerging opportunities. 2.Powerful Capital Reinforcements. To achieve economies of scale, newly-founded components businesses must quickly improve its productivity. But before this could happen, manufacturer must experience a learning period where budgetary deficits are unavoidable. However due to the reinforcements of the capital team, technical-amateur entrepreneurs can lead through this difficult period and into a most profitable period of significant growths.

The purpose of this study was to explore the relationship between the use and sophistication of accounting information systems (AISs) and the success of small businesses in South Carolina. Additionally, this study explored the variables that influence South Carolinian small business owners/managers in the extent of adoption (sophistication) of AISs. This study applied the contingency theory of management accounting information systems as the theoretical foundation of the study. The study sought to fill the gap in the literature related to the use of accounting information systems in small businesses. Previous empirical studies of owner/manager behavior have resulted in conflicting findings with respect to accounting and business processes and systems utilized in small businesses. The research question central to this study was whether or not the sophistication of accounting information systems improved the success of South Carolina small businesses. The researcher expected to find that businesses owned by individuals with business-related education and previous business experience would be using more sophisticated AISs, and therefore be more successful. The results of the study did show a positive relationship between the sophistication of the AIS and higher levels of sales in small businesses. Also, the study found a significant positive relationship between the importance the owner/manager placed on AISs and the sophistication of the AIS. The findings indicated no positive significantly related differences in the sophistication of accounting information systems and owner/manager education, experience, ethnicity, or gender.

Problem: Is there a statistically significant relationship between the EI of an ownermanager and the EO within a small firm? Purpose: The primary purpose of this study was to perform an exploratory study of the research by addressing the first hypothesis. The secondary purpose of this study was to characterize the nature of this relationship by exploring micro-connections between EI and EO factors, by addressing the second hypothesis. Hypotheses: 1) An owner-manager’s EI can be used to predict EO within small firms. 2) An owner-managers’ EI dimensions are positively correlated to the EO dimensions in small firms.   Method: A questionnaire including the EISDI (Emotional Intelligence) instrument and the Covin & Slevin (1989) Entrepreneurial Orientation (entrepreneurial/strategic posture) instrument were sent by email to respondents. Responses were collected from a sample of 35 respondents, who were identified as owner-managers of small, young firms within the Swedish high-tech industry. An empirical analysis examined correlations between global EI and global EO, as well as EI and EO factors.     Main findings: Both hypotheses were rejected. It was concluded that an owner-manager’s EI cannot be used to predict EO within small firms. Moreover, it was found that no part of an owner-manager’s EI is significantly nor strongly correlated to EO dimensions within small firms.

My dissertation focuses on foreign entrepreneurs—individuals who establish firms outside of their native countries. Despite the prevalence of foreign entrepreneurs, their strategic choices have received little attention in the research literature. For example, when starting a firm, an entrepreneur must decide whether to manage the business personally or hire a local manager, yet we know little about how this choice affects firm performance. To examine this issue, in the first study I use a novel dataset of foreign entrepreneurial firms in Russia and a visa policy change as an instrument for the owner-manager choice. Contrary to the expectation that foreign entrepreneurs would underperform local managers due to the liability of foreignness, I find that foreign owner-managers can benefit their firms: Exogenous assignment of a local manager in place of a foreign owner-manager reduces profits. Foreign owner-managers benefit their firms by hiring cheap native-country labor as well as through reduced agency costs. The second study examines how private benefits of occupying a managerial position affect an entrepreneur’s choice between owner-management and hiring an agent. I show that foreign entrepreneurs with a strong desire to reside in a host country are more likely to become owner-managers. These results are consistent with the idea that entrepreneurs expecting to gain private benefits from managing their firms are more likely to become owner-managers. Moreover, I demonstrate that entrepreneurs are willing to substitute the non-pecuniary benefits associated with relocation for firm profit. These findings add to a growing literature exploring the role of personal preferences in entrepreneurs’ strategic decisions, such as location choice and ownership structure. The third study examines the impact of media coverage on the location choices of foreign firms. Publicly available media information has largely been ignored by the location literature, perhaps because its impact on location choice is expected to be trivial. This study challenges this assumption: Using a new instrument for media coverage (a major anniversary of a city’s establishment date), I show that extensive foreign media coverage of a city increases the number of foreign entrants. Moreover, this effect is strongest for socially and geographically distant firms and entrepreneurs.

<p>Problem: Is there a statistically significant relationship between the EI of an ownermanager and the EO within a small firm?</p><p>Purpose: The primary purpose of this study was to perform an exploratory study of the research by addressing the first hypothesis. The secondary purpose of this study was to characterize the nature of this relationship by exploring micro-connections between EI and EO factors, by addressing the second hypothesis.</p><p>Hypotheses: 1) An owner-manager’s EI can be used to predict EO within small firms. 2) An owner-managers’ EI dimensions are positively correlated to the EO dimensions in small firms.</p><p> </p><p>Method: A questionnaire including the EISDI (Emotional Intelligence) instrument and the Covin & Slevin (1989) Entrepreneurial Orientation (entrepreneurial/strategic posture) instrument were sent by email to respondents. Responses were collected from a sample of 35 respondents, who were identified as owner-managers of small, young firms within the Swedish high-tech industry. An empirical analysis examined correlations between global EI and global EO, as well as EI and EO factors.</p><p> </p><p> </p><p>Main findings: Both hypotheses were rejected. It was concluded that an owner-manager’s EI cannot be used to predict EO within small firms. Moreover, it was found that no part of an owner-manager’s EI is significantly nor strongly correlated to EO dimensions within small firms.</p><p> </p>

Project management involves many different actors. Rather than solely looking at those actors as individuals, the interaction between them should not be forgotten either. This thesis tries to provide a better understanding of one specific type of interaction: the project owner-manager relationship. This relationship is approached as the dyadic interaction between one project manager and one project owner. Previous studies indicate that project owners and project managers depend on one another, but that they can have diverging perspectives as well. The goal of this study is to get a deeper understanding of how these different perspectives can influence the success of the project-owner relationship. In order to achieve this understanding, a multiple case study involving 8 project owner-manager relationships was employed. Both project owners and project managers were interviewed, in order to get closer to a multi-actor perspective. The results show that there are both similarities and differences between the perspectives of these actors. However, a lack of understanding between these perspectives can cause the project owner-manager relationship fail. In the end, the potential effects of this relationship cannot and should not be ignored, as this study shows that it can be the difference between project success and project failure. Therefore, in a world that is ever more dominated by projects, this thesis has multiple practical and scientific implications.

This thesis deals with how managerial work sets the agenda for managerial learning in small firms. Although studies of learning in organizations are numerous, research on managerial learning in the small-firm context is limited. In particular, our knowledge of managerial learning suffers from an insufficient understanding of what top managers in small firms do. The primary purpose of this thesis is to describe how the work of small-firm managers sets the agenda for managerial learning, and how their learning can be supported. Additionally, the thesis explores the use of so-called “Action Technologies” in supporting managerial learning in small firms.Drawing on an observational study of six owner-managers in small (17-43 employees) manufacturing firms, and a synthesis of earlier studies, this thesis shows that three features of managerial work shape managerial learning in small firms: The small firm’s top manager (i) operates in context with specific structural conditions that affect his/her behavior, (ii) have certain cognitive predispositions guiding his/her behavior, and (iii) have certain behavioral preferences directing his/her behavior.The main argument in this thesis is that managerial learning in small firms is made difficult due to features that make it hard to come to a point where learning (in terms of reflection and conceptualization) is given time and resources, as the manager has trouble in finding time for learning, and as learning risks to become low-priority. Learning is also difficult due to barriers related to the learning process: the work of the manager fosters a superficial learning orientation, makes it difficult to probe deeply into and to develop complicated understandings of issues at hand, and makes peer-learning rarely possible.Drawing on an action research project of managerial learning in four networks of small-firm owner-managers, the thesis also explores, in a concrete manner, how managerial learning might be supported in a way that circumvents the deficient situation for managerial learning in this kind of firm. More specifically, it seems that Action Technologies by their design constitute a learning context that supports the learning of the small-firm top manager by dissolving the barriers to learning identified above. / <p>Original papers included. Paper III, "Managerial behavior in small firms - a critical analysis of evidence from observational studies" changed title to "Managerial work in small firms: summarising what we know and sketching a research agenda".</p>

My dissertation focuses on foreign entrepreneurs—individuals who establish firms outside of their native countries. Despite the prevalence of foreign entrepreneurs, their strategic choices have received little attention in the research literature. For example, when starting a firm, an entrepreneur must decide whether to manage the business personally or hire a local manager, yet we know little about how this choice affects firm performance. To examine this issue, in the first study I use a novel dataset of foreign entrepreneurial firms in Russia and a visa policy change as an instrument for the owner-manager choice. Contrary to the expectation that foreign entrepreneurs would underperform local managers due to the liability of foreignness, I find that foreign owner-managers can benefit their firms: Exogenous assignment of a local manager in place of a foreign owner-manager reduces profits. Foreign owner-managers benefit their firms by hiring cheap native-country labor as well as through reduced agency costs. The second study examines how private benefits of occupying a managerial position affect an entrepreneur’s choice between owner-management and hiring an agent. I show that foreign entrepreneurs with a strong desire to reside in a host country are more likely to become owner-managers. These results are consistent with the idea that entrepreneurs expecting to gain private benefits from managing their firms are more likely to become owner-managers. Moreover, I demonstrate that entrepreneurs are willing to substitute the non-pecuniary benefits associated with relocation for firm profit. These findings add to a growing literature exploring the role of personal preferences in entrepreneurs’ strategic decisions, such as location choice and ownership structure. The third study examines the impact of media coverage on the location choices of foreign firms. Publicly available media information has largely been ignored by the location literature, perhaps because its impact on location choice is expected to be trivial. This study challenges this assumption: Using a new instrument for media coverage (a major anniversary of a city’s establishment date), I show that extensive foreign media coverage of a city increases the number of foreign entrants. Moreover, this effect is strongest for socially and geographically distant firms and entrepreneurs.