Department of Economics and Business Economics

Multinationality as real option facilitator – Illusion or reality?

Research output: Contribution to journal/Conference contribution in journal/Contribution to newspaperJournal articleResearchpeer-review

Standard

Multinationality as real option facilitator – Illusion or reality? / Aabo, Tom; Pantzalis, Christos; Park, Jung Chul.

In: Journal of Corporate Finance, Vol. 38, 2016, p. 1-17.

Research output: Contribution to journal/Conference contribution in journal/Contribution to newspaperJournal articleResearchpeer-review

Harvard

Aabo, T, Pantzalis, C & Park, JC 2016, 'Multinationality as real option facilitator – Illusion or reality?', Journal of Corporate Finance, vol. 38, pp. 1-17. https://doi.org/10.1016/j.jcorpfin.2016.03.004

APA

CBE

MLA

Aabo, Tom, Christos Pantzalis and Jung Chul Park. "Multinationality as real option facilitator – Illusion or reality?". Journal of Corporate Finance. 2016, 38. 1-17. https://doi.org/10.1016/j.jcorpfin.2016.03.004

Vancouver

Author

Aabo, Tom ; Pantzalis, Christos ; Park, Jung Chul. / Multinationality as real option facilitator – Illusion or reality?. In: Journal of Corporate Finance. 2016 ; Vol. 38. pp. 1-17.

Bibtex

@article{cd3e4a49badc41e3ad50d517fede5aff,
title = "Multinationality as real option facilitator – Illusion or reality?",
abstract = "Previous literature provides multiple conflicting arguments on why and when multinationality should enhance or impede the value-relevance of firms’ real options. We address this issue by examining whether the relationship between stock returns and changes in return volatility varies with multinationality. Our results indicate that multinationality does indeed act as a real option facilitator. Furthermore, we show that, consistent with the notion that there are limits to the operating flexibility associated with multinationality this benefit only accrues fully if the firm is not financially constrained and stabilizes at very high degrees of multinationality.",
keywords = "International corporate expansion; Multinationality; Real options; Stock market valuation; Multiple regression analysis",
author = "Tom Aabo and Christos Pantzalis and Park, {Jung Chul}",
year = "2016",
doi = "10.1016/j.jcorpfin.2016.03.004",
language = "English",
volume = "38",
pages = "1--17",
journal = "Journal of Corporate Finance",
issn = "0929-1199",
publisher = "Elsevier BV",

}

RIS

TY - JOUR

T1 - Multinationality as real option facilitator – Illusion or reality?

AU - Aabo, Tom

AU - Pantzalis, Christos

AU - Park, Jung Chul

PY - 2016

Y1 - 2016

N2 - Previous literature provides multiple conflicting arguments on why and when multinationality should enhance or impede the value-relevance of firms’ real options. We address this issue by examining whether the relationship between stock returns and changes in return volatility varies with multinationality. Our results indicate that multinationality does indeed act as a real option facilitator. Furthermore, we show that, consistent with the notion that there are limits to the operating flexibility associated with multinationality this benefit only accrues fully if the firm is not financially constrained and stabilizes at very high degrees of multinationality.

AB - Previous literature provides multiple conflicting arguments on why and when multinationality should enhance or impede the value-relevance of firms’ real options. We address this issue by examining whether the relationship between stock returns and changes in return volatility varies with multinationality. Our results indicate that multinationality does indeed act as a real option facilitator. Furthermore, we show that, consistent with the notion that there are limits to the operating flexibility associated with multinationality this benefit only accrues fully if the firm is not financially constrained and stabilizes at very high degrees of multinationality.

KW - International corporate expansion; Multinationality; Real options; Stock market valuation; Multiple regression analysis

U2 - 10.1016/j.jcorpfin.2016.03.004

DO - 10.1016/j.jcorpfin.2016.03.004

M3 - Journal article

VL - 38

SP - 1

EP - 17

JO - Journal of Corporate Finance

JF - Journal of Corporate Finance

SN - 0929-1199

ER -