Multinational Firms, International Diversification, Value, and Governance

2009 ◽  
Author(s):  
Jason Sturgess
Keyword(s):  
Multinational Firms ◽  
International Diversification

scholarly journals International diversification and firm’s value: evidence from developing nations

2016 ◽  
Vol 26 (2) ◽  
pp. 166-183 ◽  
Author(s):  
A.N. Bany-Ariffin ◽  
Bolaji Tunde Matemilola ◽  
Liza Wahid ◽  
Siti Abdullah
Keyword(s):  
Financial Performance ◽  
Multinational Corporations ◽  
Multinational Firms ◽  
Positive Impact ◽  
Generalized Method Of Moments ◽  
International Diversification ◽  
Technological Advancement ◽  
Reverse Causality ◽  
Content Type ◽  
The Impact

Purpose This paper aims to evaluate the impact of international diversification, through the investment abroad activities of the Malaysian multinational corporations (MNCs), on their financial performance. Design/methodology/approach The paper applies the panel generalized method of moments (GMM) estimation technique that gives better results. Findings The empirical findings show that the move to invest abroad has brought a positive impact on Malaysian MNCs’ financial performance. However, in terms of a firm’s risk, the results contradict the general internationalization-risk hypothesis. Research limitations/implications The study focuses on the top 100 multinational firms; future researchers may extend the time period and use the entire sample of all the multinational firms. Practical implications Foreign investments offer rewarding returns due to cheaper labour and raw materials, competitive edge in terms of technological advancement and larger market opportunities. Originality/value The paper contributes to the literature using the panel GMM’s estimation that effectively control for reverse causality and serial correlation problem. The paper also contributes to the international diversification and performance relationship, in a fast-growing Malaysia.

International diversification and firm performance: a four-stage model

2016 ◽  
Vol 11 (3) ◽  
pp. 362-375 ◽  
Author(s):  
Alberto Ferraris ◽  
Stefano Bresciani ◽  
Manlio Del Giudice
Keyword(s):  
Multinational Firms ◽  
International Diversification ◽  
Data Availability ◽  
Stage Theory ◽  
Unified Theory ◽  
Content Type ◽  
Final Sample ◽  
And Performance ◽  
The Relationship ◽  
Practical Implications

Purpose The purpose of this paper is to investigate the relationship between international diversification (ID) and performance in multinational firms by proposing a new and unified theory of multinationality that incorporates, integrates and extends previous concepts and hypotheses. Design/methodology/approach The study relies on data concerning the world’s largest companies, derived from the Fortune Global 500. An OLS regression analysis has been carried out in order to test a four-stage relationship between ID and performance. Findings On a final sample of 391 multinationals, this paper provides an empirical evidence that support the existence of a four-stage theory by using a relevant sample of “top” multinational firms. Research limitations/implications This study has two main limitations: first, a single indicator was used to measure ID; second, some potential variables have had to be excluded due to data availability. Practical implications This paper offers some intriguing practical implications, as well: first, it points out to some thresholds where performances are higher at certain level of ID; second, it highlights that performance will face two kinds of decreases due to intra-regional and inter-regional liability of foreignness; finally, it individuates differences with regard to some firms’ characteristics such as home or host country’s behaviors and about the kind of industries in which they operate, as well. Originality/value This is one of the first studies that tests and finds positive evidences about a four-stage theory, regarding to the relationship between ID and performance. Moreover, it proposes other interesting results with regard to the differences between home vs host country-oriented firms and between manufacturing vs services multinational firms.

International Diversification and Forecast Optimism: The Effects of Reg FD

2008 ◽  
Vol 22 (2) ◽  
pp. 179-197 ◽  
Author(s):  
Donald R. Herrmann ◽  
Ole-Kristian Hope ◽  
Wayne B. Thomas
Keyword(s):  
Multinational Firms ◽  
Forecast Accuracy ◽  
International Diversification ◽  
Analyst Forecast ◽  
Full Sample ◽  
Forecast Bias ◽  
Fair Disclosure ◽  
Foreign Operations ◽  
Diversified Firms ◽  
Reg Fd

SYNOPSIS: Research shows that analysts following companies with a higher portion of foreign operations provide more optimistic forecasts, presumably to maintain favorable relations with management and thereby obtain improved access to information. We examine the effect of the introduction of Regulation Fair Disclosure (Reg FD) on analyst forecast bias for internationally diversified firms. We hypothesize that analysts’ incentives to issue optimistic forecasts for such firms should be reduced in the post-Reg FD era, because Reg FD prohibits firms from selectively disclosing management information to analysts. First, we demonstrate that average forecast bias decreases for our full sample of multinational firms. Second, we show that the positive relation between forecast optimism and international diversification significantly declines (and even disappears) in the post-Reg FD period. Reg FD appears to have been successful in reducing analysts’ optimistic bias and in reducing the effect of forecasting complexity on forecast bias for our sample of multinational firms. In a sensitivity test, we also find that the relation between international operations and forecast accuracy improves in the post-Reg FD period.

U.S. Multinationals as Vehicles for International Diversification

CFA Digest ◽  
2001 ◽  
Vol 31 (3) ◽  
pp. 102-103
Author(s):  
William H. Sackley
Keyword(s):  
International Diversification

What's at Stake for the LDCs, Now that the Uruguay Round Talks have been Suspended? (The Distinguishedl Lecture)

1991 ◽  
Vol 30 (4I) ◽  
pp. 579-599
Author(s):  
Robert E. Baldwin
Keyword(s):  
Multinational Firms ◽  
Uruguay Round ◽  
National Policy ◽  
Trade In Services ◽  
Trade Negotiation ◽  
Multilateral Trade Negotiation ◽  
Industrial Countries ◽  
Goods And Services ◽  
Foreign Affiliates ◽  
Merchandise Trade

Until negotiations collapsed in early December, the Uruguay Round gave promise of being the most significant multilateral trade negotiation since 1947, when the General Agreement on Tariffs and Trade (GA TI) was implemented and tariffs levels of the industrial countries were sharply cut. There are at least three reasons for this conclusion. First, by agreeing at the outset to bring both agriculture and textiles under GATT discipline, the participants created the opportunity for both rich and poor agricultural exporting nations and relatively low-wage, newly industrializing LDCs to benefit significantly from GATT-sponsored trade negotiations. Prior to the Uruguay Round, the benefits to these countries of such negotiations had been limited, since these two sectors were excluded from any significant liberalization. Second, by agreeing to formulate new rules relating to trade in services, trade-related aspects of· intellectual property rights, and trade-related investment issues, members took an important step in modernizing the GATT. As economic globalization has accelerated, there is a growing realization that arms-length merchandise transactions, the traditional concern of the GATT, are only one aspect of the real-side economic relations of current concern to national policy-makers and the economic interests they represent Now international commercial activities also involve merchandise trade among multinational firms and their foreign affiliates, international trade in services among independent agents as well as among affiliated enterprises, foreign direct investment activities, production nf goods and services in foreign affiliates for sale either abroad or at home, international flows of technology, and temporary movements of labour across borders. Although the so-called new issues in the Uruguay Round do not cover all of these matters, they go a considerable way in making the GATT more relevant for dealing with the problems of increasing internationalization.

The organization of multinational firms in the European urban system

Flux ◽  
1994 ◽  
Vol 10 (17) ◽  
pp. 5-17 ◽  
Author(s):  
Céline Rozenblat
Keyword(s):  
Multinational Firms ◽  
Urban System

International Diversification and Microfinance

2009 ◽  
Author(s):  
Rients Galema ◽  
Robert Lensink ◽  
Laura Spierdijk
Keyword(s):  
International Diversification
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