Investment size has been overlooked by scholars who study foreign direct investment (FDI). This overlook hinders our understanding of globalization, because the study of investment size will shed light on how firms of different sizes develop and participate in the current trend of globalization,...

Studying a sample of Japanese firms, we examine whether foreign investors exert a significant influence on earnings management through manipulation of real activities. We find that foreign investors play an independent role in restraining real earnings management, as captured by abnormal cash...