Why Investors Value Multinationality.
The authors examine the value of multinationality to investors as reflected in firms' q ratios. The positive impact of research and development and advertising spending on a firm's q is enhanced by multinationality, but multinationality itself has no significant impact. This supports the internalization theory's prediction that intangible assets are necessary to justify direct foreign investment and, thus, a recent strand of trade literature that assumes multinational firms have intangible assets with public good properties. The authors' results do not support the hypothesis that investors value multinational firms as a means of diversifying their portfolios internationally. Copyright 1991 by University of Chicago Press.
Year of publication: |
1991
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Authors: | Morck, Randall ; Yeung, Bernard |
Published in: |
The Journal of Business. - University of Chicago Press. - Vol. 64.1991, 2, p. 165-87
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Publisher: |
University of Chicago Press |
Saved in:
Online Resource
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