Reliance on Foreign Markets: Multinationality and Performance

Makoto Nakano is a professor at the Graduate School of Commerce and Management of Hitotsubashi University in Japan, where he completed his Ph.D. in management and accounting in 1995. His research is related to corporate finance, corporate governance, and equity valuation. Dr. Nakano has published on these subjects in Corporate Governance: An International Review (vol. 20; 2012), Applied Financial Economics (vol.23; 2013), and The Japanese Accounting Review (vol. 2; 2012). Bayanjargal Purevdorj is an assurance associate at a public accounting firm based in the United States, working with private companies including foreign companies operating in the North American region. He completed his study of management and accounting in 2012 at the Graduate School of Commerce and Management of Hitotsubashi University. His research was related to corporate finance and accounting, focusing on the foreign business of Japanese multinational corporations.

1. Introduction.- 2. Theory and Prior Evidence on Multinationality. 2.1 Benefits and Costs of Multinationality. 2.2 Prior Empirical Evidence on Multinationality and Performance.- 3. Hypotheses.3.1 Multinationality and Profitability. 3.2 Multinationality and Firm Value.- 4. Description of Data and Methodology. 4.1 Description of Data. 4.2Trends in Overseas Operations of Japanese Multinational Companies.4.3 Model.- 5.Empirical Results. 5.1 Descriptive Statistics and Correlations. 5.2 Results and Discussion.- 6. Robustness Check and Additional Tests. 6.1 Alternative Measurement Test. 6.2 Regional Breakdown Test.- 7. Conclusion.