Department of Economics and Business Economics

Multinationality and Opaqueness

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  • Tom Aabo
  • Christos Pantzalis, University of South Florida, United States
  • Jung Chul Park, Auburn University, United States
We investigate whether and how multinationality affects the opaqueness of the firm. We use multiple alternative measurements of multinationality and opaqueness. Spanning nearly three decades for a large sample of US non-financial firms, we find a statistically and economically significant, positive relationship between multinationality and opaqueness. We find that this positive relationship hinges on whether or not the degree of foreign involvement is compatible with the structure of the firm's foreign operations network. Our results imply that multinationality's impact on opaqueness is alleviated when there is harmony between the size of foreign involvement and the extent of the MNC network's geographic dispersion. Previous literature has implicitly assumed a simple, positive relationship. This is the first study to explicitly address the question in a comprehensive manner.
Original languageEnglish
JournalJournal of Corporate Finance
Pages (from-to)65-84
Number of pages20
Publication statusPublished - 2015

Bibliographical note

Campus adgang til artiklen / Campus access to the article

    Research areas

  • Multiple regression analysis, Internationalization theory, Stock market valuation, Stock prices, Multinationality, Opaqueness

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