Nghiên cứu các nhân tố tác động đến đầu tư tài sản của doanh nghiệp nhỏ và vừa tại tiểu vùng tây bắc tt tiếng anh

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MỞ ĐẦU
1. The need for research
Firstly, asset investment is very important for the continuous and sustainable development process of businesses, so
it needs careful research and careful decision-making. Assets investment of enterprises are often strategic decisions, the
process of assets investment will require a large amount of capital with a high level of risk, so it cannot be overlooked.
Secondly, in recent years, the SMEs in the Northwest subregion have continually invested in increasing the size of
their assets but the average business efficiency has been declining, which raises concerns about rationality of investment
activities. On that basis, clarifying the factors affecting asset investment will really help managers in general and SMEs in the
Northwest subregion in particular to properly perform the tasks of corporate finance management. At the same time, it is the
basis for the State to issue appropriate policies, support enterprises to invest assets according to their wishes and achieve the
set goals.
Thirdly, although the researches on factors affecting enterprises' investment have been mentioned by many domestic
and foreign researchers, there are still "gaps" that need to be further added and clarified. Very few specific studies have
considered the impact of qualitative factors on firm's asset investment. In particular, no studies have considered the impact of
local socio-cultural development factors, access to loans and internal control in enterprises. There are no in-depth studies on
the assets investment of SMEs. At the same time, the study also used a combination of both quantitative and qualitative
methods based on both primary and secondary data sets.
Fourth, the research results of the SME group in the Northwest subregion will enrich the findings of the SME group
in Vietnam in general and in regions with similar difficulties to the Northwest in particular, contribute to developing this
group of enterprises. A new study on SME investment assets will enrich the research results have on this company group.
With specific geographic location, the research results in the Northwest subregion will be of reference value and application
to both the Northern Uplands, as well as some difficult provinces / regions.
From the reasons mentioned above, the topic: "Studying the factors affecting the assets investment small and
medium-sized enterprises in the Northwest sub-region" was selected for research.
2. Objectives of the research
The overall objective of the study is to identify the factors affecting the asset investment of SMEs in the Northwest
subregion. On that basis, specific objectives include: (1) Learn about the theoretical basis and overview of research on asset
investment, factors affecting the company's asset investment. (2) Understanding the real situation of assets, asset investment
of SMEs in the Northwest subregion. (3) Identify the factors affecting the asset investment of SMEs in the Northwest
subregion through testing econometric models. (4) Propose appropriate recommendations based on research results.

3. Research questions
Research questions include: (1) In the context of Vietnam's economy and the characteristics of the Northwest
subregion, are there any hypotheses and research models to study the factors affecting SMEs' asset investment? (2) In this
context, which factors affect the investment of SMEs' assets, the dimensions and level of impact of the factors found? (3)
What recommendations do research results provide?
4. Objects and scope of research
- Object of the study: The object of the research is the factors affecting the investment of assets of SMEs, in which asset
investment is approached in two aspects: investment scale and selection of yes / Do not invest in assets. The factors tested
include both quantitative and qualitative factors.
- Research scope:
Research period: Secondary data for the study were collected from 2014 to 2017. Primary data were collected from
April to July 2018.
Research space: SMEs in the Northwest subregion include 4 provinces: Son La, Dien Bien, Lai Chau and Hoa Binh.
5. Research methodology
The author mainly uses quantitative research methods based on both primary and secondary data sets to determine
the relationship between factors to asset investment of enterprises by the techniques of Cronbach's Alpha, EFA, multivariate
regression with evidence that the experimental results are highly reliable and convincing.
In addition, the research results of the thesis are determined based on both primary and secondary data sets,
especially the scales / indicators are built based on the research overview and the real situation of localities, there is a
correction after consulting experts and business managers.
6. New contributions of research

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6.1. Contributtion in theory and research methods
Firstly, research on a topic that is rarely mentioned in the world and is relatively new in Vietnam at doctoral level.
Previously, researchers have pointed out some factors affecting the overall investment of enterprises, but the test results on
the influence of some factors are not consistent, specific studies about the factors affecting the assets investment of
enterprises are still very limited. According to the review of the thesis’s author, previous researchers mainly mentioned the
influence of quantitative factors and very few studies have considered the impact of qualitative factors. Therefore, the
research results will contribute to enriching the theoretical basis of factors affecting the enterprises's asset investment.

Second, this is the first time that a group of qualitative variables include: infrastructure, technology, local
preferential policies, local socio-cultural development, markets, ability to access loans of businesses and especially the
internal control factor in the enterprise is proven to affect the asset investment of the enterprise, in the case of SMEs in the
Northwest subregion. On that basis, the research’s result about these factors will contribute to more complete theory.
Importantly, the research results provide the basis for state agencies to issue regional development policies that are consistent
with the unique characteristics of the Northwest subregion - an area with a strategic position about national security and
defense, but it is the region with the lowest level of socio-economic development in the country.
Third, measuring the qualitative factors in the financial economy is not really popular, especially the measurement
of qualitative factors in the enterprises environment affecting the assets investment of enterprises is very new. Moreover,
factors of internal control is often less studied because of difficulties in collecting internal information in enterprises,
especially in Vietnam. Therefore, building a set of scales with indicators measuring the impact of internal control factors on
the enterprises's asset investment is really meaningful.
Fourthly, the thesis combines both qualitative and quantitative research methods, so asset investment of enterprises
is considered more comprehensively, increasing the persuasiveness and rationality of research results. Thereby, the thesis will
encourage researchers to interested in using modern analysis methods and tools to develop research in the field of investment
of enterprises.
6.2. Practicial contribution
Firstly, enterprises managers will have a better understanding of the factors affecting the enterprises's asset
investment, which is the basis for making asset investment decisions more effective, make plan and enterprises strategies for
businesses more reasonable. Not only that, the study discovered the inadequacies in asset investment of SMEs in the
Northwest subregion based on scientific and reliable evidence. By verifying both quantitative and qualitative factors, based
on primary and secondary data sets, the thesis has reasonably and satisfactorily explained about the situation of excessive
asset investment while asset efficiency is reduced in SMEs in the Northwest subregion. The scientific evidence shows that
these enterprises have invested based on the advantages of external conditions and factors in the business environment but
they are less interested in the profitability of assets and overlooked internal control in enterprises. These issues have never
been mentioned and considered in the reports and review summaries of enterprise management agencies. Facing this
situation, managers will have an overview of these activities, thereby drawing lessons as well as experiences in the process of
asset investment, avoiding the situation of enterprises investing in assets too little or too much without effectiveness in future.
Secondly, policy -makers as well as regulatory agencies in general and the Northwest subregion in particular will
also understand better about the factors impacting on asset investment of enterprises, from there, they formulate strategies,

make plans, orientations and preferential policies appropriately to attract investment, creating favorable conditions for
businesses to invest effectively and sustainably.


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CHAPTER 1. OVERVIEW OF RESEARCH AND THEORETICAL BASIS OF FACTORS AFFECTING
ASSETS INVESTMENT OF ENTERPRISES.
1.1. Overview of factors affecting the assets investment of enterprises
1.1.1. The studies on the world about factors affecting asset investment of enterprises
* The effect of the revenue factor
Eisner (1960) demonstrated that if firms have high revenue growth, they tend to invest less. Fama (1974) and
Erkaningrum (2013) have argued that revenue growth has a positive effect on investment of enterprises.
* Influence of equity factor
Budina et al. (2000) suggested that firm investment would be limited by the availability of equity. Gelos and Werner
(2002).
* Effect of debt factor
Baskin (1989) has argued that high dividend rates make enterprises reduce investment in the future. Allen (1993),
Aivazian, Ge and Qiu (2005); Noravesh and Yazdani (2010) confirm that debt size has an opposite effect on investment,
contradicts Baneijee's research (2010).
* Profitability factor
Research results of Baskin (1989), Abel and Eberly (1994), Erkaningrum (2013) have shown that profitability is
positively correlated with investment of enterprises.
* Effect of ability to access loans factor
Vladimir et al. (2003), Nhung Nguyen et al. (2013) showed that the growth of enterprises decreased when there are
institutional and financial barriers.
* Influence of internal control factor
Richardson (2006) has affirmed that a certain control mechanism can limit excessive investment in enterprises.

Agrawal et al. (1996). Core et al. (1999) stated that the more strict the internal control, the more limited representation costs,
leading to overinvestment of enterprises.
* Influence of factors: infrastructure, technology and social culture
Amado (1989) emphasized the development of infrastructure as a factor to attract investors. Galan et al. (2007)
argued that infrastructure and technology factors have a positive relationship in the choice of investment positions of
multinational companies. At the same time, these authors also believed that the cultural and social factors have a positive
relationship to the investment of enterprises.
* Influence of local factor (institutional and preferential policies)
Sachs and Wanrner (1995), Barro and Salai-martin (1997) have pointed out that the quality of institutions is
positively related to investment. Amado (1989), Dunning (1997) and Kotler (2002) have affirmed the role of preferential
policies for investment.

- In terms of content, there are very few studies that have shown the influence level of factors on the company's asset
investment. Previous research only mentioned investment decisions or general investment of enterprises, the results of
verification were not consistent.

* Influence of market factor

1.2.2. Concept of asset investment in the enterprises

Dunning (1980); Kravis and Lipsey (1982); Tatoglu and Glaister (1998), Galan et al. (2007) have affirmed that the
market is one of the important factors in determining the investment position of multinational companies.

Starting from the view of Bernard Guerien (2007) on investment and the views of Renata and Zuzana (2015) on
assets, combined with the view of Sachs and Larrain (1993), asset investment of enterprises is understood as sacrificing
resources in the present to increase the scale of assets to serve the production and business process to bring economic benefits
in the future.

1.1.2 Research in Vietnam on factors affecting firm's asset investment
* Influence of factors related to firm's characteristics (turnover, equity, debt leverage, profitability, ability to access loans,

internal control)
Le Khuong Ninh et al. (2008) affirmed that revenue growth has a positive effect on enterprises 's investment, but Le
Bao Lam and Le Van Huong (2010) have argued that revenue has a negative impact on investment of enterprise. Le Bao Lam
and Le Van Huong (2010) have shown that the equity variable decreases when the size of enterprises increases. Le Khuong
Ninh et al (2008) stated that debt is proportional to enterprises's investment. Le Bao Lam and Le Van Huong (2010) have
shown that profitability is positively correlated with enterprises’s investment. Nguyen Phi Lan (2006), Le Thi Lan (2017), Le
Hoang Ba Huyen (2012) once thought that there was a negative relationship between input costs and investment of
enterprises.
* Influence of outside enterprises factors (technology infrastructure, socio-culture, institutions, local policies, markets)
Nguyen Phi Lan (2006), Le Hoang Ba Huyen (2010) concluded that infrastructure and technology factors have a
positive relationship in the choice of investment location of multinational companies. Le Hoang Ba Huyen (2012) and Le Thi
Lan (2017) have shown that preferential policies are positively related to investment decisions of enterprises in Thanh Hoa
province. Nguyen Phi Lan (2006), Le Hoang Ba Huyen (2012) pointed out the positive relationship between market factors
and FDI capital of enterprises.
1.1.3. Research gaps

- Regarding the scale, measuring the impact of qualitative factors in the business environment on enterprise investment is
relatively new. Previously, internal control factors were rarely mentioned, therefore, a study measuring internal control
factors in enterprises would enrich both theory and practice.
- Regarding research samples, the old authors focus on researching state-owned / non-state enterprises, listed / unlisted
enterprises or industry-specific enterprises, without in-depth research on asset investment of SME. Research results of SMEs
will enrich the theory.
- Regarding research methods, the combination of qualitative and quantitative research methods, combination of primary and
secondary datas will enrich the research methods in the field of enterprise’s investment.
1.2. Theoretical basis of asset investment and factors affecting the asset investment of enterprises
1.2.1. Theories related to asset investment of enterprises
1.2.1.1. Financial management theory
Brigham and Houston (2009) once considered investment decisions to be one of financial management's decisions.
Investment decisions are decisions related to the total value of assets, the value of asset parts and the balanced relationship
between the parts of asset in the enterprise.

1.2.1.2. Eclectic theory
Dunning (1997) mentioned the advantages of the region mainly including external environmental factors of
enterprises. It is really necessary to consider the impact of external environmental factors on the assets investment of
enterprises.
1.2.1.3. Local marketing theory (regional marketing)
Kotler (2002) asserted that the development of localities in the future will depend on the expertise, contribution
skills, quality of people and organizations in the locality. Each locality will have its own plans and strategies to create
different characteristics.
1.2.1.4. Agency theory
In fact, many shareholders who own the majority of enterprises' shares act for individual benefits (Armor et al.,
2009). Firms with weak governance structures face the theory of more representative costs and managers of those firms may
gain more individual benefits (Core et al., 1999). In 1976, Jensen and Meckling once pointed out that the presence and
representation of owners can prevent the optimal decision making of private enterprises (Holmstrom, 1989).

1.2.3. Theoretical basis of factors affecting enterprise's asset investment
1.2.2.1. Quantitative factors
- Revenue: Revenue often has a positive impact on the investment activities of enterprises (Le Khuong Ninh et al,
2008; Erkaningrum, 2013), enterprises may also have to reduce investment when sales fall ( Fama, 1974).
- Equity: For small-sized enterprises, investment activities are often influenced by equity (Gelos and Werner, 2002;
Budina et al., 2000).
- Liabilities: Investment of enterprises is often governed by the size of debts in enterprises (Allen, 1993; Aivazian,
Ge and Qiu, 2005; Noravesh and Yazdani, 2010).
- Profitability: For small and medium-sized enterprises, a enterprise with high profitability will be able to invest
more (Baskin, 1989). Therefore, the higher the profitability of assets or from production and business activities, the more
enterprises invest (Erkaningrum, 2013).
1.2.2.2. Qualitative factors
- Infrastructure and technology of the economy: An economy with developed infrastructure and technology can help
enterprises save costs.
- Local institutions: Quality of institutional is related to firm investment (Sachs and Wanrner, 1995).
- Local preferential policies: Incentive policies play an important role in investment activities (Amado, 1989;

Dunning, 1997; Kotler, 2002).


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- Culture - Society: It shows the social attitude and value of culture, is one of the factors of the business environment
that affect investment of enterprises.

CHAPTER 2. REAL SITUATION OF ASSET INVESTMENT OF SMALL AND MEDIUM ENTERPRISES
IN THE WEST NORTH

- Market: The cooperation of suppliers, the availability of labor force are the decisive factors to the effectiveness of
the enterprise's investment activities.

2.1. General characteristics of economy - society and small and medium enterprises in the Northwest subregion

- Ability to access loans: If the loan barriers are large, low access to loans may cause enterprises to lose investment
opportunities.
- Internal control of enterprises: By intensifying supervision of activities, enterprises can limit agency costs and
control investment activities (Agrawal et al., 1996).

2.1.1. General characteristics of economy - society in the Northwest subregion
* Population and education level
In 2017, there was more than 21.825% of the population aged 15 and older that was illiterate, which is the highest
area compared to other localities in the country, showing that the cultural level of the population in the region is the lowest.
* Local economic characteristics
The socio-economic situation in the Northwest region has been assessed as stable in recent years. In general, the
Northwest is considered as a low starting area. Although it is rich in natural resources, it is difficult to exploit, lack of capital,

outdated technology and inadequate human resources, resulting in very low economic efficiency (Khanh, 2016).
2.1.2. Characteristics of SMEs in the Northwest subregion
* About the quantity
In 2017, the total number of SMEs in the Northwest sub-region was about 3,965 enterprises. The number of SMEs
in Hoa Binh is greater than in other provinces, the number of SMEs in Lai Chau is the lowest in the region.
* Structure by Industry business
The number of SMEs operating in agriculture, forestry and fisheries is very small (7.8% of the total SME in the
Northwest region). Most enterprises focus on industries and construction or trade and services.
* Structure of business results
Of the total 3,965 SMEs in the Northwestern region, only 2,445 enterprises operating in production and business had
profits, accounting for 61.67% of the total number of SMEs in the whole region, while the number of SMEs making losses
amounted to 1,001 enterprises accounting for 25.24%.
2.2. Situation of investing in assets of small and medium-sized enterprises in the Northwest sub-region
* The situation of asset investment of SMEs in the Northwest region over the years
Although the number of enterprises increasing asset investment over the years is less, but in general, the majority of
SMEs in the Northwestern region tend to invest more assets over the years. Although most businesses increase their scale of
asset investment, there are fewer and fewer businesses investing in long-term assets and the majority of businesses tend to use
less long-term assets or do not change the structure of their asset type.
* Assets investment situation of SMEs in the Northwest subregion classified by enterprise size
The average total assets or capital of medium-sized enterprises is 4.97 times higher, the average size of liabilities is
6.06 times higher than small-sized enterprises. The debt ratio of medium-sized enterprises is higher than that of small-sized
enterprises, suggesting that the medium-sized enterprises have a higher debt utilization rate.
The indicators reflecting ROA and ROE of both groups of enterprises decreased over the years, in which, ROE
dropped the most. This proves that the business efficiency of enterprises is also declining, profitability of equity and assets
are reduced.
In addition, the efficiency of using assets of both groups of enterprises also decreases over time, but medium-sized
enterprises are more efficient than small-sized enterprises.
* Assets investment situation of SMEs in the Northwest subregion classified by type of enterprise
In general, the efficiency of using assets of all types of enterprises has been in the downtrend over time. In
particular, the efficiency of the use of assets in limited liability companies is still the highest while private enterprises have

the lowest efficiency.
* Assets investment situation of SMEs in the Northwest sub-region classified by business activities
The number of enterprises in agriculture, forestry and fishery is the least (only 7.8% of the number of enterprises
surveyed) but the average size of enterprises is not too small (an average of 1.33 times the size of enterprises in the Trade and
service sector) and also tend to increase in recent years with an average growth rate during the period of 2014-2017 is 11.6%.
In particular, the size of long-term assets in enterprises in this industry is the largest, showing that businesses in agriculture,
aorestry and fisheries invest more long-term assets than enterprises in other industries. The number of enterprises in industry
and construction sector is very large, accounting for 53.5% of enterprises studied, the average size of enterprises in this
industry is the largest and has been increasing in recent years but the average growth rate in the whole period was only
9.59%, which is slower than other types of enterprises.


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Effective use of the asset of enterprises in agriculture, forestry and fisheries, and trade and service sectors has
decreased over time, particularly enterprises in industrial and construction have decreased sharply in 2015 and slightly
increased in lately year. Effective use of the asset of enterprises in Trade and Services sectors is always higher than
enterprises in other industries. Meanwhile, Effective use of the asset of enterprises in industry and construction enterprises is
not stable over time and always lower than other enterprises in other industries.
* Some other statistical results
Statistical results show that the majority of SMEs in the Northwest subregion have a high demand for expanding the
scale, which also means that the demand for asset investment in enterprises is very large. It is shown that, every year, over
61% of enterprises increase their scale of asset investment. Particularly in 2015, it was the time when the economy was
recovering from the impact of the global financial crisis, so the number of enterprises increased in size, accounting for 69.5%
of the total number of enterprises studied. Although the number of these enterprises have declined in recent years but still
high proportion. That is not to mention businesses with increasing demand scale but not able to meet the demand.
In addition, in 2015, more than 57% of enterprises increased debt ratio and this ratio was always above 50% over the
years, which shows that most enterprises have increased the size of liabilities and annual debt ratio. Combined with statistical
results of other criteria, it can be affirmed that small and medium enterprises in the Northwest subregion tend to use more
debt to invest in assets.

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CHAPTER 3. RESEARCH METHODS
3.1. Research questions and research hypotheses
3.1.1 Research questions
Based on the real estate investment of SMEs in the Northwest subregion, the management question to clarify is:
"Why are SMEs in the Northwest subregion continually investing to increase asset size over time while profitability of assets
is tending to decline?" Accordingly, the thesis identifies research questions as presented in the introduction.
3.1.2 Research hypothesis
The study will test the following hypotheses:
Hypothesis 1 (H1.1): Equity capital of enterprises has a positive impact on the assets investment of enterprises.
Hypothesis 2 (H1.2): Revenue has a positive impact on the assets investment of enterprises.
Hypothesis 3 (H1.3): The debt ratio has a positive impact on the asset investment of the enterprise.
Hypothesis 4 (H1.4): Profitability has a positive impact on asset investment of enterprises.
Hypothesis 5 (H2.1): Infrastructure, technology and institutions have a positive impact on asset investment of
enterprises.
Hypothesis 6 (H2.2): Local preferential policies have a positive impact on the assets investment of enterprises.
Hypothesis 7 (H2.3): Local culture - society has a positive impact on the assets investment of enterprises.
Hypothesis 8 (H2.4): The market has a positive impact on asset investment of enterprises.
Hypothesis 9 (H2.5): The ability to access loans has a positive impact on asset investment of enterprises.
Hypothesis 10 (H2.6): Internal control of enterprises has a negative effect on the assets investment of the enterprises.
3.2. Model framework and research design
3.2.1. Research model framework
The author proposes a model framework to verify the quantitative factors affecting the enterprise's asset investment:
Invest in assets

Quantitative factor:
- Equity
- Revenue
- Debt ratio
- Profitability - ROA

Panel data regression

(Increase /
decrease in scale
of asset
investment)

Figure 3.1. The model framework proposes quantitative factors affecting enterprise's asset investment
(Source: Authors' research)
From research overview, the author also found that there are very few studies examining the relationship between
qualitative factors and firm's asset investment, so this may also be a gap to be studied. Therefore, the author proposes a
framework for researching the qualitative factors described in Figure 3.2.
The qualitative factors groups:
- Infrastructure, technology and
institutions
- Local preferential policies
- Culture - Society of the locality
- Market
- Ability to access loans
- Internal control

EFA

Qualitative
factor

Regress

Invest in assets

(yes / no invest)

Binary

Figure 3.2. The model framework proposes qualitative factors affecting enterprise's asset investment
(Source: Authors' research)
3.2.2 Research design
- Systematize theoretical basis and overview of factors affecting the company's asset investment through research techniques
at the table.
- Find out the situation, build and complete the scale / indicator after consulting with experts and business managers in the
area.
- Verify the impact of quantitative factors (financial factors).


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- Verify the impact of qualitative factors.

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- Based on the research results, propose recommendations.

The thesis examines the correlation; test the conformity of models: OLS, FEM and REM; test the model's defects
(multi-collinear phenomena, variance of variation errors and chain correlation).

3.3 Research model

3.4.2 Data and data collection methods study the qualitative factors

3.3.1 Research model for quantitative factors

3.4.2.1. Source and method of data collection

The research model has the form: Y = β0 + β1X1 + β2X2 + β3X3 + β4X4 + ε
In which: Y: Total Assets (natural log) (Asset); X1: Ratio of Equity to Total Assets (Equity); X2: Revenue (natural
log) (Sale); X3: Debt ratio (Ratio of Liabilities / Total assets) (Debtratio); X4: Profitability ROA (Ratio of Profit after tax /
Total assets).
3.3.2 Research model of qualitative factors
The research model has the form:
Y =β0 + β1X1 + β2X2 + β3X3 + β4X4 + β5X5 + β6X6 + ε
In which: Y: The dependent variable of the enterprise's asset investment, receiving the value of 1 or 0; X1:
Infrastructure, technology and institution factor (TC); X2: Local preferential policy factor (CS); X3: Cultural and social of the
locality factors (VH); X4: Market Factor (TT); X5: Ability to Access loan factor (VV); X6: Internal control factor (KS).
a. Group of factors on infrastructure, technology and institutions
This group of factors includes a scale that reflects both infrastructure and technology factors developed from the
questionnaire in the research of Galan et al (2007), Tatoglu et al (1998), Loree. et al. (1995), Le Thi Lan (2017). Local
institutional issues are developed from the scales of Salai-martin (1997), Sachs and Wanrner (1995), Dinh Phi Ho (2012).

The author received the help of Son La and Hoa Binh Association of Enterprises, Lai Chau Young Enterprise
Association, Statistical Office of Dien Bien Province, the survey was conducted from 4/2018 to 6/2018. The number of
satisfactory questionnaires collected was 370.
3.4.2.2. The size of the research sample
According to Hair et al. (2006), the minimum sample size is: 32 * 5 = 160 observations. In addition, according to the
formula to determine the sample size of Nguyen Thi Tuyet Mai and Nguyen Vu Hung (2015) above, the minimum sample
size is 350 observations. The study surveyed with 700 questionnaires.
3.4.2.3. Characteristics of research samples
The number of private enterprises and limited liability companies accounts for the majority of the sample, focusing
on industry and construction, the number of enterprises in agriculture, forestry and fishery is very limited.
3.5 Data processing technology
3.5.1 Data processing technique of quantitative factor research model
The thesis has described statistics, examines the correlation, multi-collinear, test the conformity of models: OLS,

FEM and REM, examine the model's defects (variance of variance of changes and chain correlation).

b. Group of factors on local preferential policies

3.5.2 Data processing technique of qualitative factors research model

Inheriting the scale in the research of Ulgado (1996), Tatoglu (1998), Yongqiang Gao (2011). In addition, based on
the current situation of investment promotion in localities, the author adds two new scales: state / local support in terms of
access to ground and taxes.

3.5.2.1 Techniques for assessing reliability of scales and discovering factor analysis

c. Group of factors about Culture - Society of the locality

3.5.2.2 Binary logistic regression technique

The author identified these factors based on the scale used in the study of Galan et al (2007), Hofstede (1980). Based
on the customs, practices and living situation of ethnic minorities in the Northwest subregion, the thesis adds a scale of
customs and habits of the people.

The author tested the significance of the regression coefficients by Wald test and Test the suitability of the model by
Chi-squared test with the observed significance level given in the Omnibus Test of Model Coefficients table.

d. Group of market factors
This group of factors was developed based on the scales of Zhou et al. (2002), Shane et al. (1994) and the scales to
measure the inputs factor of enterprises of Dunning (1998), Tatoglu et al. (1998) and Galan (2007).
e. Group of factors on loan accessibility
Based on the scale of the financial barriers for enterprises of Wit (1996) and the ability to access loans of Kochar
(1997), Stiglitz and Weiss (1981), Bigsten et al (2003), the author developed the scale to measure group of factors of
enterprises' ability to access loans.

f. Group of factors for internal control
The group of internal control factors was developed based on the scale of Orapan Khongmalai et al (2010), Mohd
Hassan et al (2008), Holmstrom (1989); Quttainah et al (2013); Hasan and Song (2014) on corporate governance.
3.4. Data and data collection methods
3.4.1 Data and data collection methods study the quantitative factors
3.4.1.1. Source and how to collect data
Quantitative data was collected from 2014 to 2017 at the Statistical Office in Son La, Dien Bien and Hoa Binh
province. Data of enterprises in Lai Chau province is collected in the Tax Department of Lai Chau province.
3.4.1.2. The size of the research sample
The author selected SMEs in 4 provinces: Dien Bien, Hoa Binh, Son La and Lai Chau to study. According to the
formula for calculating the sample size of Nguyen Thi Tuyet Mai and Nguyen Vu Hung (2015), the sample size for the study
is 350 observations. The study collected data of 564 enterprises.
3.4.1.3. Characteristics of research sample
The statistical results show that the number of small-sized enterprises is the majority (69.32%), enterprises are
organized under two types: private enterprises and limited liability companies. Basically, the model's sample characteristics
ensure the similarity with the overall study.
3.4.1.4. Information processing

The author assesses the reliability of the scale, explore factor analysis and Binary logistic regression. From there,
perfecting the set of scales ensures both convergent and discriminant values.


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4.1. Research results on quantitative factors affecting the asset investment of SMEs in the Northwestern region

The results of the 1st Cronbach's Alpha test showed that 6 indicators need to be removed. After removing 6 indicators,
the scale set with 6 groups of factors with 26 indicators was retested, the results of the second Cronbach's Alpha test showed that

the scales were standard, eligible for use in explore factor analysis EFA.

4.1.1. Descriptive statistics results

4.2.1.2. EFA discovery factor analysis

CHAPTER 4. RESEARCH RESULTS

The analysis results show that KMO coefficients and Barlett tests are satisfactory, the indicators in the model
converge on 7 factors. The results of the Varimax rotation factor matrix show that no indicators are removed.

Descriptive statistical results are presented in Table 4.1.
4.1.2. Correlation analysis results
The analysis results show that the independent variables in the model have low correlation coefficients so it is less
likely to have multiple collinearity.
4.1.3. Multicollinearity test results
Testing results show that the model does not violate defects in multi-collinear phenomenon.
4.1.4 Test results to select an appropriate model
* Estimates with Pooled OLS: The estimation results show that the OLS estimates may be an appropriate estimate.
* Compare Pooled OLS with REM: Test results show that Prob> chibar2 = 0.000 <0.05. Thus, REM model is more
appropriate than OLS model.
* Compare Pooled OLS with FEM: F-test result shows that FEM model is more suitable than OLS model.

When analyzing, indicators HT1, HT2 and HT3 converge to a separate group, indicators HT5, HT6, HT7 converge
into a separate group. Based on the general characteristics of the indicators, called the infrastructure and technology factor
group (HT) and the local institutional factor group (TCH). The author checked the reliability with Cronbach’s Alpha
coefficient for the factor groups, the test results were satisfactory.
Thus, from 6 factor groups with 26 initial indicators, after the explore factor analysis - EFA, 26 indicators formed 7
groups of factors that explain 67,758% of the change in asset investment. of the enterprise.
4.2.2. Test results on the suitability and reliability of the model

The testing results show that the coefficients in the model are really meaningful, the correct prediction rate of the
whole model is 93%, the independent variables in the model are not closely correlated with each other.
4.2.3. Estimated results of the model

* Compare REM with FEM: The test results show that FEM model is more suitable than REM model.

Table 4.9. Regression results of the impact of qualitative factors on the firm's asset investment

As such, the FEM model is the most suitable.

Variables in the Equation

4.1.5. Test results of conformity, reliability and defects of the model

B

S.E.

Wald

HT

4.605

.786

34.317 1

.000 99.981

The testing results show that the model is considered appropriate, the model explains 32.73% of the fluctuation of
the size of the enterprise's asset investment.

THC

5.414

.786

47.469 1

.000 224.452

* The defects of the model

CS

.653

.415

2.470

.116 1.921

VH

7.145

1.004 50.686 1

.000 1267.162

TT

6.576

.959

46.975 1

.000 717.655

VV

5.948

.947

39.412 1

.000 382.905

KS

-5.282

.731

52.164 1

.000 .005

Constant -66.268 8.861 55.927 1

.000 .000

* Testing the suitability of the model

The test results show that the model occurs both variance change phenomenon and autocorrelation phenomenon. As
proposed by Arellano (1987) and Froot (1989), using the "strong standard errors in group" test will help the model to
overcome both phenomena.

Step 1

4.1.6. Estimated results of the model
Table 4.4. Estimated results of the model of factors affecting enterprise's asset investment
Variable

Beta coefficient
3,539619
(0,000)
0.0543113
(0,463)
0,0602643***
(0,000)
0,3065588***
(0,000)
0,1666791**
(0,031)

2256
0.3273

Const
ERT
Sale
Debtratio
ROA
Number of observations
R-square Overall
Note: *, **, ***: Correspond to significance level less than 10%, 5%, 1%
The values in parentheses () are t-tests.

a

df Sig. Exp(B)

1

a. Variable(s) entered on step 1: HT, THC, CS, VH, TT, VV, KS.
(Source: Authors' research)
The testing results show that the regression coefficients are significant, the regression coefficients of the preferential
policy factor are not significant in the model.
- The more businesses emphasize the impact of infrastructure and technology factors, the more they will tend to
increase asset investment
- The more the SMEs attaches importance to local institutional factors, the more they tend to increase asset
investment.
- In the process of asset investment, the more enterprises are affected by the local socio-cultural factors, the more
they are likely to increase asset investment.
- For market factors, the more the impact of this factor, the more enterprises will increase asset investment.

- The more enterprises are affected by the factor of access to loans, the more enterprises will increase investment in
assets.

(Source: Authors' compilation from STATA software)

- The more important the internal control factor is, the more it affects enterprises, the more they tend to reduce or not
invest in assets.

The model explained 32.73% of the change in the size of investment assets of enterprises. The results show that the
ERT variable is not statistically significant, the remaining estimates in the model are statistically significant at 1% including:
Debt ratio (Debtratio) and ROA. Particularly, the revenue variable (Sale) is statistically significant at the 5% level.

- In addition, CS variables are not statistically significant in the model. It also means that the research results have
not created a reliable basis to confirm (accept) the hypothesis H2.2 proposed above.

4.2. Research results on qualitative factors affecting the asset investment of SMEs in the Northwestern region
4.2.1. Results of testing the reliability and suitability of the scale
4.2.1.1. The results of testing the reliability of the scale


13
CHAPTER 5. DISCUSSION ABOUT RESEARCH RESULTS
5.1. Discuss the research results of factors affecting the asset investment of SMEs in the Northwestern region

14
* Improve internal management ability to increase financial resources of enterprises: Enterprises should proactively improve
their financial capacity, businesses should also choose a reasonable loan structure to ensure safety and financial balance.

5.1.1. Discuss the research results of quantitative factors

* Enhancing competitiveness: Enterprises should focus on developing in depth with training to improve skills and expertise
for employees, investing to improve product quality.

5.1.1.1. Revenue factor

5.2.2. Recommendations for the state and local governments

The statistics show that the average revenue of SMEs in the Northwest subregion also tends to increase over the
years, the average revenue growth rate of these enterprises in the period was 2.57%> 0.

* About infrastructure and technology: Local authorities should focus on improving the quality of public services, banking
and financial services, and improving access to science and technology of enterprises.

5.1.1.2. Debt ratio factor

* About local institutions: Need to continue adjusting and administrative reform to create conditions for enterprises to
implement investment procedures more easily and quickly.

Statistics show that SMEs in the Northwest region tend to increase debt ratio, while these enterprises tend to expand
in size. The small and medium size makes enterprises face difficulties in raising capital, so the increase in annual debt ratio
will create good opportunities for enterprises to invest more assets. Thus, the research results are consistent with reality.
5.1.1.3. Profitability factor - ROA
Quantitative research results show that ROA has a positive impact on the size of the asset investment of enterprises.
Meanwhile, the analysis of the situation shows that the average ROA of these enterprises tends to decrease over time.
Logically from the regression results, when the ROA decreases, the total assets decrease. But in fact, total assets increased.
This proves that the single impact of ROA has been overwhelmed by the combined effect of many other factors that increase
total assets.
5.1.1. Discuss the research results of qualitative factors
5.1.2.1. Infrastructure and technology factors
Infrastructure and services systems in the Northwest subregion are increasingly upgraded and newly invested, it

proves that the infrastructure system and technology of the localities are growing, which facilitates enterprises to invest more
assets.
5.1.2.2. Local institutional factors
In recent years, local governments have reformed and innovated to reduce cumbersome administrative procedures,
this change has facilitated enterprises in the area to invest more assets.
5.1.2.3. Cultural and social factors of the locality
The cultural level of the people is still improving. Model of community tourism have brought income to local
people. The attitude and conduct of the people is not a big barrier to enterprises when making asset investment as before.
5.1.2.4. Market factor
Labor force is more and more plentiful, the skills of the workers are increasingly improved. The higher average
income of people in the region will make it easier for enterprises to invest more assets.
5.1.2.5. Factors ability to access loans
With the growing development, loan interest rates are increasingly flexible, preferential loan programs are quite diverse
and abundant, loan procedures are simplified which has created conditions for enterprises to access loans more easily.
5.1.2.6. Internal control factors of enterprises
The survey shows that the majority of SMEs in the Northwest do not have a clear separation mechanism between
ownership and management rights, there isn’t appropriate decentralization and decision-making mechanisms. Therefore, it
has facilitated the increase of agency costs and increased risk of misleading corporate governance decisions.
5.1.3. General discussion
The study confirms that the more the market develops, the more demand for products of enterprises in the market,
then it will create more conditions for enterprises to increase sales and encourage enterprises to invest more assets. The easier
the ability to access loans, the more opportunities enterprises have to borrow and encourage enterprises to actively invest in
assets. The weak ability of internal control combined with the reduction of cost management capability shows that the
internal management capability of SMEs in the Northwest subregion is becoming increasingly weak.
5.2. The recommendation to facilitate and encourage businesses to invest assets in SMEs in the Northwest subregion
5.2.1. Recommendations for SMEs
* Priority to increase the profitability of assets (ROA): To improve ROA, businesses should focus on improving the cost
management capacity and ability to exploit assets.
* Strengthening internal management ability of enterprises: Enterprises need to set up strict internal control system, reducing the level
of independence of the board of directors.

* About local culture - society: Deploying a number of effective economic models associated with the customs and practices
of the people, eliminating the ethnic community with the local backward customs.
* About market: Local governments should aim to build a healthy economic environment and ensure fairness among
enterprises.
5.2.3. Recommendations for credit institutions
Credit institutions should enhance advisory and support businesses to better understand loan conditions and
procedures, complete loan documents in accordance with regulations and standards of credit institutions.
5.3. Suggest next research directions
(1) Expand the research sample with more businesses. (2) Add quantitative research variables such as late variables
of revenue, ROA, level of enterprise’s risk. (3) Add qualitative variables such as the role of the independent control board,
the existence of informal costs (discounts, agent commissions) to the person making investment decisions in assets, to further
clarify the impact of agency costs in the enterprise's asset investment decisions. (4) Carry out in-depth studies on cost
management capacity, internal management of enterprises; Influence of ownership and group interests on asset investment;
Influence of attitudes and behaviors of managers on asset investment.


15
CONCLUDE
Based on the inheritance and development of the previous research results, the study builds a model of factors
affecting the asset investment and asset investment scale of SMEs in the Northwest sub-region. Factors identified include
both quantitative and qualitative factors.
Using a combination of both quantitative and qualitative research methods, with a combination of both primary data
surveyed from 370 enterprises and secondary data as financial statements of 564 enterprises. The study results have identified
the impact of quantitative factors on the size of asset investment including revenue, debt ratio and profitability of assets ROA. All factors have a positive relationship with the size of the enterprise's asset investment. The reality of asset investment
activities of enterprises and research results from the model have confirmed the impact of qualitative factors such as
infrastructure and technology, local institutions, markets, and local culture - society, ability to access loans and internal
control system of businesses.
The research results show that SMEs in the Northwest subregion tend to invest assets based on the influence of
available resources and external favorable conditions, they underestimate the real profitability of assets as well as the

requirements of strict control during the investment process. The external manifestations illustrate the perception that SME
managers in the Northwest subregion the concept of asset investment is made when enterprises have the ability and
conditions to invest without paying attention to the need or long-term effect of investment decisions. This situation will
inevitably lead to long-term consequences, typically the waste of resources, increasing debt to owners and eroding the profits
of small shareholders. Moreover, ineffective SMEs investing in assets will also reduce the effectiveness of the state-supported
and implemented macro policies for these enterprises. Therefore, although asset investment with SMEs is necessary, it is
necessary to consider the profitability of assets as well as the process of asset investment should be conducted under strict
control to ensure the sustainability of investment activities.
In the future, enterprises themselves need to prioritize to exploit the maximum profitability of total assets, need to
strengthen internal control, focus on improving competitiveness; local government agencies in the area should continue to
improve infrastructure and technology, reform administrative procedures, improve economic and cultural life for people,
build a healthy competitive enterprises environment; and credit institutions should strengthen advising SMEs to complete
loan applications, use loans effectively, along with building a database on SMEs as a basis for credit rating for enterprises
groups.