CEO Wealth and Cross-border Acquisitions by SMEs

Flladina Zilja; Gabriel R. G. Benito; Hamid Boustanifar; Dan Zhang

doi:10.1016/j.ibusrev.2023.102192

CEO Wealth and Cross-border Acquisitions by SMEs

Flladina Zilja^*, Gabriel R. G. Benito, Hamid Boustanifar, Dan Zhang

^*Corresponding author af dette arbejde

Institut for International Økonomi, Politik og Business

Publikation: Bidrag til tidsskrift › Tidsskriftartikel › Forskning › peer review

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Abstract

This study examines the role of chief executive officers’ (CEOs) wealth in explaining the cross-border acquisition (CBA) activity of small and medium-sized enterprises (SMEs). CBAs require substantial financial resources and expose the firm to additional risks. Within a micro-foundations framework, we integrate insights from the resource-based view and the upper echelons theory and argue that CEO wealth plays a dual role in the CBA activity of SMEs by alleviating financial constraints and increasing willingness to take risks. Using Norwegian census data for the period 2000–2013, we find consistent evidence that CEO wealth has a positive effect on the number, the geographic scope, and the likelihood of engaging in CBAs in high political risk countries.

Originalsprog	Engelsk
Artikelnummer	102192
Tidsskrift	International Business Review
Vol/bind	32
Udgave nummer	6
Antal sider	17
ISSN	0969-5931
DOI	https://doi.org/10.1016/j.ibusrev.2023.102192
Status	Udgivet - dec. 2023

Bibliografisk note

Published online: 14 September 2023.

Emneord

Cross-border acquisitions;
SMEs
Chief executive officers
Wealth
Financial constraints
Risk-taking

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10.1016/j.ibusrev.2023.102192Licens: CC BY

flladina_zilja_et_al_ceo_wealth_and_cross_border_acquisitions_publisherversionForlagets korrektur version, 1,05 MBLicens: CC BY

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Citationsformater

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AU - Benito, Gabriel R. G.

AU - Boustanifar, Hamid

AU - Zhang, Dan

N1 - Published online: 14 September 2023.

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AB - This study examines the role of chief executive officers’ (CEOs) wealth in explaining the cross-border acquisition (CBA) activity of small and medium-sized enterprises (SMEs). CBAs require substantial financial resources and expose the firm to additional risks. Within a micro-foundations framework, we integrate insights from the resource-based view and the upper echelons theory and argue that CEO wealth plays a dual role in the CBA activity of SMEs by alleviating financial constraints and increasing willingness to take risks. Using Norwegian census data for the period 2000–2013, we find consistent evidence that CEO wealth has a positive effect on the number, the geographic scope, and the likelihood of engaging in CBAs in high political risk countries.

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KW - Chief executive officers

KW - Wealth

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KW - Chief executive officers

KW - Wealth

KW - Financial constraints

KW - Risk-taking

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