The economic impact of Multinational Enterprise on emerging markets: The case of MTN in Nigeria

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Acknowledgement

I would first like to express my gratitude for my research supervisor, colleagues, peers and family whose immense and constant support has been a source of continuous guidance and inspiration.

DECLARATION

I [type your full first names & surname here], declare that the following dissertation and its entire content has been an individual, unaided effort and has not been submitted or published before. Furthermore, it reflects my opinion and take on the topic and is does not represent the opinion of the University.

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Abstract

This study examines whether and to what extant emerging-market multinational enterprises (EM MNEs) can use outward FDI in a developed market to capture knowledge spillovers so as to improve their technological capabilities at home. We refer to this as a “reverse spill over” effect on parent firms, and develop it based on the knowledge-seeking motive for FDI by EM MNEs. Extending previous studies that have identified the knowledge-seeking motive and have also provided some evidence for its validity; our study focus's on the effects of such FDI on technological capabilities of EM MNEs at home. Using a panel detest of 493 EM MNEs over the prod 2000-2008, and controlling for possible endogenously, we find evidence supporting the reverse spill over effect: EM MNEs that have subsidiaries in host developed markets richer in technological resources (measured by R&D investments and R&D employment) exhibit stronger technological capabilities at home. We discuss the implications of our study for research and practice related to the internationalization of EM MNEs. This study or research aims at exploring the value of infrastructure sharing as a means of achieving cost efficiency and revenue assurance. The research is based on a case study analysis of the currant collocation arrangement between MTN Nigeria Ltd and Zain Nigeria Ltd. The study seeks to explore the benefits of the infrastructure sharing deal between these two companies as well as recommend an improved or enhanced framework or model to sustain this strategy model in the context of the Nigerian telecommunications industry.

Table of Content

DECLARATION3

CHAPTER 1: INTRODUCTION6

CHAPTER 2: LITERATURE REVIEW9

Roles of the Capital Market11

Contribution of the Capital Market to Socio-economic Development of Nigeria13

Financing Government's Infrastructural Projects14

Privatization of State Owned Enterprises (SOEs)15

Market Capitalization16

Total New Issues16

Listed Securities17

Value of Transactions17

The Nigeria Telecoms Industry Outlook17

CHAPTER 3: METHODOLOGY23

Research Design23

Model Specification24

Sampling Strategy25

Data Collection Strategies25

CHAPTER 4: DISCUSSION AND ANALYSIS26

Regression Result27

CHAPTER 5: CONCLUSION31

REFERENCES36

Chapter 1: Introduction

The penetration of emerging market multinational enterprises (EM MNEs) into developed markets (DMs) through outward foreign direct investments (OFDI) is a significant but relatively understudied phenomenon (e.g., Bertoni, Elia, and Rabbiosi, 2008; Buckley, Elia, and Kafouros, 2010; Yamakawa, Peng, and Deeds, 2008). An important motivation for such OFDI is to access advanced knowledge and capabilities available in DMs and to utilize them to improve the technological and innovative capabilities of the parent companies in emerging markets (Makino, Lau, and Yeh, 2002; Mathews and Zander, 2007; Luo and Tung, 2007; Rui and Yip, 2008; Deng, 2009). This “knowledge seeking” motivation of EM MNEs has been ...