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...

We exploit the 2011 Japanese natural disaster to investigate the effects of deep disruptions of Japanese parent firms’ production activities on South Korean subsidiaries’ operations. Using a simple DiD specification applied to firms from the KNSO panel database we detail the features of a...

Local density (the number of firms vying for similar resources in a local environment) has been overlooked in explaining foreign subsidiary performance. This study draws upon the literatures on liability of foreignness and density dependence to examine how local density within the host country...

This paper studies why multinational firms often share ownership of a foreign affiliate with a local partner even in the absence of government restrictions on ownership. We show that shared ownership may arise, if (i) the partner owns assets that are potentially important for the investment...