The Emergence of Born Global Firms: A Least-developed Country Perspective A Dissertation Presented by Farhad Uddin Ahmed Supervised by Professor Louis Brennan to Trinity Business School The University of Dublin (Trinity College Dublin), Ireland in Fulfilment of the Requirements for the Degree of Doctor of Philosophy in Business Studies Trinity Business School The University of Dublin, Trinity College July 2016 STATEMENT OF ORGINALITY I hereby declare that this scholarship is entirely my own work and that it has not been submitted as an exercise for the award of a degree at this or any other University. Signature/name Date Farhad Uddin Ahmed Trinity Business School The University of Dublin (Trinity College Dublin), Ireland ii COPYRIGHT STATEMENT Please note the following terms and conditions: I agree to deposit this dissertation in the University’s open access institutional repository or allow the library to do so on my behalf, subject to Irish Copyright Legislation and Trinity College Library conditions of use and acknowledgement, This dissertation is also protected by copyright and other intellectual property rights retained by the author of this work, The text, findings or any other materials of this dissertation cannot be reproduced, cited and quoted for commercial and non-commercial purpose without prior formal permission obtained from the author. © 2016 – Farhad Uddin Ahmed All rights reserved. iii DEDICATION This amazing and intellectual PhD journey would not have been possible without the unconditional and boundless blessing, love and encouragement of my parents. Therefore, I would like to dedicate this scholarship to my mother, Chashme Akter and in the memory of my late father, Jamal Uddin Ahmed. ACKNOWLEDGEMENT First of all, I am highly thankful to Allah almighty for giving me the intellect, persistence and passion to complete this doctoral study. Secondly, this scholarly endeavour would not have been possible without the help, cooperation and inspiration of several individuals and organisations. The outstanding guidance, invaluable advice, incredible encouragement and countless time of my supervisor Professor Louis Brennan helped me to be part of a scholarly community, and led me to where I stand now. Therefore, I would like to express my sincere gratitude to my supervisor Professor Louis Brennan. This has been an incredible experience, great honour and privilege working with Professor Brennan throughout this scholarly journey. I am also indebted to Professor Frank Barry who agreed to act as an internal reader of my thesis. He has been a real help in terms of proof-reading, reviewing my work and providing important feedback. I am also thankful to the Chairman of my dissertation examination panel Professor Martin Fellenz. I would also like to express my sincere gratitude to Professor Farhad Analoui and Professor James Stewart for serving as examiners of my doctoral dissertation and letting my defense be a pleasant experience, and finally for their brilliant comments and suggestions. My special thanks go to Professor Joseph McDonagh, the Director of Doctoral Programme, for his great support and motivation during those critical times that I went through on my father’s bereavement. I would like to thank Dr Anisur Rahman Faroque (Head, Department of Marketing at American International University Bangladesh) for his wholehearted support and suggestions during this journey. iv I am also very grateful to my several colleagues in Trinity Business School, who have been most generous in helping me on several aspects of my dissertation. In particular, I would like to thank Deepak Saxena and Paul Lyons for all of their time and support. I would also like to thank the Graduate Studies Office and Trinity Business School for the financial supports in terms of conference attendance and fieldwork. Most importantly, I would like to acknowledge the privilege of being awarded ‘Trinity Studentship Award’ for my doctoral study. Without this scholarship the PhD journey would not have been possible. Many thanks also go to Valerie McCarthy, Joan Reidy and Samantha Peavoy for their outstanding administrative supports throughout the years. Since the respondents are critical to the accomplishment of any research project, my deepest thanks also go to those entrepreneurs and executives who agreed to participate in the survey and cooperated in the data collection process. Without their help and cooperation this scholarship would not have been possible. Finally, on a personal note, I would like to acknowledge the patience, love and encouragement of my wonderful wife Maliha Ahmed throughout the accomplishment of this degree. I am forever indebted to you for your understanding, patience, sacrifices and encouragement during the past four years. I am also indebted to my parents-in-law Mohammad Masud Sikder and Jesmine Masud for their love, support and inspiration. I would like to extend my gratitude and compliments to my brothers Reaz Uddin Ahmed and Raihan Uddin Ahmed, and sisters Farhana Akter Shemu and Fouzia Akter Lipa for their love, inspiration and prayers. My gratitude list also include Apu vhai, Nisha vhabi, Nasrin vhabi, Rahi, Toma, Proma, Kanta apu, Shajal vhai and all other relatives and friends for their love and inspiration. Finally, a special love is always for my adorable nephews Ahnaf and Samin, and nieces Ifreet, Inaya and Nazha. v ABSTRACT This empirical study addresses the impact of the principal founder’s human capital (HC) factors and their level of entrepreneurial orientation (EO) along with the national export promotion policies (EPPS), on born global firms (BGF) originating from a relatively low-tech and buyer-driven industry in a least-developed country (LDC). Given the widespread prevalence and economic significance of BGF, to date a large number of studies have been directed towards examining the antecedents, business strategies and performance of BGF with a focus on high-tech or knowledge-intensive small and medium-sized enterprises in developed and advanced-emerging countries. Notwithstanding that, a review of the literature suggests that findings concerning BGF are not yet comprehensive since there is limited consideration of how such firms emerge and develop from countries that are at different levels of economic maturity. In particular, evidence suggests that our knowledge on BGF theory is not yet comprehensive since the existing theory is confined to findings from developed and advanced- emerging countries. This implies that the literature around BGF originating from LDCs is almost non- existent. This shortfall is significant because evidence suggests that many low-tech and labour- intensive firms in LDCs are engaged in international business from inception or shortly thereafter, although their international growth aspirations are often hampered by several socio-economic and institutional constraints. Therefore, given the lack of studies in the context of LDCs, it can be argued that addressing this theoretical and empirical shortcoming by incorporating an LDC context can enrich the domain of international entrepreneurship (IE) in an important way. In order to address the identified knowledge gap, this study engages in quantitative analysis using data drawn from the Bangladeshi apparel industry. Drawing on the human capital theory, the resource-based view, and the institutional-based view, this study develops and tests a BGF emergence model that incorporates the principal founder’s general (education and prior international experience) and specific (prior start-up and previous industry- specific working experiences) HC factors, founders’ level of EO (innovativeness, proactiveness and risk-taking propensity), and national EPPS (finance and guarantee-related and market-development related EPPS) constructs. The model also includes a number of control variables (founder’s age, vi founding team composition and firm size). The findings of this study confirm that BGF originating from a low-tech and buyer-driven industry in an LDC are influenced by their principal founder’s specific HC factors, founders’ risk-taking propensity, and the exploitation of market-development related EPPS. Additionally, this study confirms that the principal founder’s age has a significant and positive impact, whereas the founding team size has a significant but negative impact on BGF. However, contrary to the extant findings for developed and advanced-emerging economies, the founder’s general HC factors, and their level of innovativeness and proactiveness are not found to be significant determinants. Moreover, the results do not confirm the significant effect of finance and guarantee-related export promotion programmes. The findings are evaluated in the light of the extant literature and several explanations are derived as to why some findings diverge from the established literature on developed and advanced-emerging countries. The contributions of this study are manifold. Theoretically this study contributes to IE literature by developing and testing a BGF emergence model in the context of an LDC. This study also contributes to the literature by providing support that specific HC factors, particularly prior start-up and industry- specific working experiences are significant determinants of BGF. Moreover, the findings pertain to EO construct contribute to IE literature by demonstrating that risk-taking propensity is one of the key capabilities of a founder that is required for adopting a BGF strategy. This study also makes a notable contribution