AIB 2012 Conference Proceedings - Academy of International ...

MONDAY
conditions of country risk and cultural uncertainty. (For more information, please contact: Jose Pla-Barber,
University of Valencia, Spain: jose.pla@uv.es)
The Entry Mode Choice in Family-Owned Firms
Yi-Chieh Chang, St. John's University
Chih-Hao Tsai , National Sun Yat-Sen University
Chih-Fang Chiu, National Taiwan University
Our study is designed to shed further light on the foreign direct investment (FDI) decision by the family
business, and address the question: Under what situation family-owned firms make the entry mode with high
risk commitment. To explore this scenario, we import from knowledge-based view (KBV) to explain how the
family business with local knowledge affect the FDI decision. (For more information, please contact: Chih-Fang
Chiu, National Taiwan University, Taiwan: juju0802@gmail.com)
Session: 2.2.12 - Interactive
Track: 10 - Economics, Finance and Accounting
Ownership Change
Presented On: July 2, 2012 - 10:45-12:00
Chair: Liu Wang, Providence College
Corporate Cash Holdings and Global Financial Crisis: An Empirical Study of Chinese Companies
Mohamad Sepehri, Jacksonville University
Yujun Lian, Sun Yat-Sen University
Maggie Foley, Jacksonville University
This study investigates the determinants of cash holdings in the period 1999-2009 in China. The sample period
covers the time of financial crisis. The focus in this study is on how firm characteristics, especially financial
constraints and investment options, are associated with cash holdings. The findings show that: • Compared
to "normal" times, Chinese firms tend to increase their cash holdings during the financial crisis. • In general,
the firms with more financial constrains, and with more investment opportunities, tend to hold more cash. •
Further, the firms with lower leverage, less net working capital (NWC), and lower capital expenditures, are more
likely to increase their cash holdings as well. Likewise, those firms tend to save more cash from cash flow. •
The evidence suggests that Chinese firms are precautious with their cash holdings. (For more information,
please contact: Mohamad Sepehri, Jacksonville University, USA: msepehr@ju.edu)
Gold for the Golden Years: Cross-Border Acquisitions and Inside Debt
Krista Burrill Lewellyn, Old Dominion University
In the wake of new SEC disclosure rules, the business media and academics have begun to highlight the
substantial levels of "inside debt" e.g., defined pension benefits, many U.S. chief executive officers (CEOs) have
garnered. This study draws from the accumulated body of knowledge of executive compensation from multiple
disciplines, to assess MNC firm level outcomes of this under-analyzed variable. Results indicate cross-border
acquisition activity is positively related to CEO levels of inside debt, suggesting CEOs may use this corporate
strategy as a means for diversifying their personal risk and increasing the firm's liquidation value, putting them
in alignment with firm bondholders as opposed to equity holders. (For more information, please contact: Krista
Burrill Lewellyn, Old Dominion University, USA: klewelly@odu.edu)
AIB 2012 Conference Proceedings
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