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 for this work

Department of International Economics, Government and Business

Research output: Contribution to journal › Journal article › Research › 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.

Original language	English
Article number	102192
Journal	International Business Review
Volume	32
Issue number	6
Number of pages	17
ISSN	0969-5931
DOIs	https://doi.org/10.1016/j.ibusrev.2023.102192
Publication status	Published - Dec 2023

Bibliographical note

Published online: 14 September 2023.

Keywords

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

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title = "CEO Wealth and Cross-border Acquisitions by SMEs",

abstract = "This study examines the role of chief executive officers{\textquoteright} (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.",

keywords = "Cross-border acquisitions;, SMEs, Chief executive officers, Wealth, Financial constraints, Risk-taking, Cross-border acquisitions, SMEs, Chief executive officers, Wealth, Financial constraints, Risk-taking",

author = "Flladina Zilja and Benito, {Gabriel R. G.} and Hamid Boustanifar and Dan Zhang",

note = "Published online: 14 September 2023.",

year = "2023",

month = dec,

doi = "10.1016/j.ibusrev.2023.102192",

language = "English",

volume = "32",

journal = "International Business Review",

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AU - Zilja, Flladina

AU - Benito, Gabriel R. G.

AU - Boustanifar, Hamid

AU - Zhang, Dan

N1 - Published online: 14 September 2023.

PY - 2023/12

Y1 - 2023/12

N2 - 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.

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.

KW - Cross-border acquisitions;

KW - SMEs

KW - Chief executive officers

KW - Wealth

KW - Financial constraints

KW - Risk-taking

KW - Cross-border acquisitions

KW - SMEs

KW - Chief executive officers

KW - Wealth

KW - Financial constraints

KW - Risk-taking

U2 - 10.1016/j.ibusrev.2023.102192

DO - 10.1016/j.ibusrev.2023.102192

M3 - Journal article

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