Date of Completion

Fall 12-15-2018

Thesis Advisor(s)

Qing Cao

Honors Major

Business Administration


Business Administration, Management, and Operations | Business Analytics | International and Area Studies


A few years ago, The Economist promulgated that “the only way that companies can prosper in [emerging] markets is to cut costs relentlessly and accept profit margins close to zero” (The Economist, 2010). Likewise, according to the World Bank’s 2018 Ease of Doing Business Index[1], the least ranked countries (#94 and under out of 190 countries) are solely undeveloped and developing, while the top 20 countries are solely developed economies (World Bank, 2018). It has been long held that emerging markets[2][3] are non-strategic investments for multinational expansion, and that business giants from developed countries[4] should comparatively capture global market share with ease. Logically, then, developed countries’ large[5] consumer good[6] enterprises should always have unmatching competitive advantage over developing countries’ large cap businesses. They have more stable governments, larger economies, greater access to capital, and higher GDP per capita[7].

[1] The Ease of Doing Business Index ranks countries by business friendliness via factors such as taxes, regulations, and so on. Please refer to the supplementary index Exhibit C (2018 Ease of Doing Business Index).

[2] Emerging markets are upcoming developed economies that possess limited liquidity in local debt and stock markets, as well as tangible financial structures such as banks and common currencies (Investopedia).

[3] The International Monetary Fund lists 40 countries as emerging economies and 23 countries as developed. Countries from least to most developed are frontier, emerging, and developed economies.

[4] Developed markets possess widespread liquidity in local debt and stock markets, as well as tangible financial structures such as banks and common currencies (Investopedia).

[5] A large enterprise typically is globally defined as having over $10 million in assets although this may vary depending on location (Krainara, 2013).

[6] Consumer or final goods are the results of production that are sold as is. Examples include clothing, food, services, and furniture. Contrastingly, raw or basic materials such as wood are used to make consumer goods such as furniture.

[7] GDP per capita (PPP) compares GDP on a purchasing power parity basis divided by population as of 1 July for the same year (The World Factbook).