The effect of international diversification on investment efficiency

IF 6.3 2区经济学 Q1 BUSINESS, FINANCE

Research in International Business and Finance Pub Date : 2024-11-06 DOI:10.1016/j.ribaf.2024.102641

Alireza Askarzadeh , Kenneth Yung , Fatemeh Askarzadeh

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Abstract

Although internationalization research has proliferated recently, scant attention has been devoted to understanding why international expansion decreases firm value. By applying the concepts of transaction cost economics and agency theory, we propose that the impact of internationalization on investment efficiency—a critical determinant of international strategy success—is significant. Internationalization often exacerbates information asymmetry and complicates effective monitoring leading to diminished investment efficiency. Moreover, this relationship is moderated by international experience, the intensity of industry competition, and the stage of the firm's lifecycle. An Ordinary Least Squares regression analysis of a US sample with 49,168 firm-year observations between 1989 and 2022 supports our predictions. This study not only advances internationalization theories but also provides a fresh perspective on the performance implications of international expansion, underscoring the organizational and industrial conditions that influence the success of internationalization efforts.

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国际多样化对投资效率的影响

尽管国际化研究近来如雨后春笋般涌现，但人们却很少关注国际扩张为何会降低企业价值。通过应用交易成本经济学和代理理论的概念，我们提出，国际化对投资效率--国际战略成功的关键决定因素--的影响是巨大的。国际化往往会加剧信息不对称，使有效监督变得复杂，从而导致投资效率降低。此外，这种关系还受到国际经验、行业竞争强度和企业生命周期所处阶段的影响。对 1989 年至 2022 年间 49,168 个企业年观测数据的美国样本进行的普通最小二乘法回归分析支持了我们的预测。这项研究不仅推进了国际化理论的发展，还为国际扩张的绩效影响提供了一个全新的视角，强调了影响国际化努力成功与否的组织和行业条件。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Research in International Business and Finance BUSINESS, FINANCE-

CiteScore

11.20

自引率

9.20%

发文量

240

期刊介绍： Research in International Business and Finance (RIBAF) seeks to consolidate its position as a premier scholarly vehicle of academic finance. The Journal publishes high quality, insightful, well-written papers that explore current and new issues in international finance. Papers that foster dialogue, innovation, and intellectual risk-taking in financial studies; as well as shed light on the interaction between finance and broader societal concerns are particularly appreciated. The Journal welcomes submissions that seek to expand the boundaries of academic finance and otherwise challenge the discipline. Papers studying finance using a variety of methodologies; as well as interdisciplinary studies will be considered for publication. Papers that examine topical issues using extensive international data sets are welcome. Single-country studies can also be considered for publication provided that they develop novel methodological and theoretical approaches or fall within the Journal''s priority themes. It is especially important that single-country studies communicate to the reader why the particular chosen country is especially relevant to the issue being investigated. [...] The scope of topics that are most interesting to RIBAF readers include the following: -Financial markets and institutions -Financial practices and sustainability -The impact of national culture on finance -The impact of formal and informal institutions on finance -Privatizations, public financing, and nonprofit issues in finance -Interdisciplinary financial studies -Finance and international development -International financial crises and regulation -Financialization studies -International financial integration and architecture -Behavioral aspects in finance -Consumer finance -Methodologies and conceptualization issues related to finance