International diversification and the market value of new product introduction

Journal of International Management

Volumn 17, Issue 4, 2011, Pages 333-347

  Wang, Chi Feng ^a   Chen, Li Yu ^b   Chang, Shao Chi ^c  

^a NATIONAL YUNLIN UNIVERSITY OF SCIENCE AND TECHNOLOGY   (Taiwan)

^b FO GUANG UNIVERSITY   (Taiwan)

^c NATIONAL CHENG KUNG UNIVERSITY   (Taiwan)

Author keywords

Event study; International diversification; Marketing capability; New product introduction; Technological capability

Indexed keywords

EID: 81155128616     PISSN: 10754253     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.intman.2011.03.002     Document Type: Article

References (103)

1. Acs Z., Audretsch D. Innovation in large and small firms: an empirical analysis. The American Economic Review 1988, 78:678-690.
2. Aiken L.S., West S.G. Multiple Regression: Testing and Interpreting Interactions 1991, Sage, Newbury Park.
3. Austin D.H. An event-study approach to measuring innovative output: the case of biotechnology. The American Economic Review 1993, 83:253-258.
4. Barkema H., Vermeulen F. International expansion through start-up or acquisition: a learning perspective. Academy of Management Journal 1998, 41:7-26.
5. Bartlett C.A., Ghoshal S. Managing Across Borders: the Transnational Solution 1989, Harvard Business School Press, Boston.
6. Benou G., Madura J., Ngo T. Wealth creation from high-tech divestitures. The Quarterly Review of Economics and Finance 2008, 48:505-519.
7. Bowman R.G. Understanding and conducting event studies. Journal of Business Finance and Accounting 1983, 10(4):561-584.
8. Bowman E.H., Helfat C.E. Does corporate strategy matter?. Strategic Management Journal 2001, 22:1-23.
9. Bowman R.G., Navissi F. Earnings management and abnormal returns: evidence from the 1970-1972 price control regulations. Accounting and Finance 2003, 43:1-19.
10. Brock D.M., Yaffe T., Dembovsky M. International diversification and performance: a study of global law firms. Journal of International Management 2006, 12:473-489.
11. Brown S.J. The number of factors in security returns. Journal of Finance 1989, 44(5):1247-1262.
12. Brown S.J., Warner J.B. Measuring security price performance. Journal of Financial Economics 1980, 8:205-258.
13. Brown S.J., Warner J.B. Using daily stock returns: the case of event studies. Journal of Financial Economics 1985, 14:3-31.
14. Capar N., Kotabe M. The relationship between international diversification and performance in service firms. Journal of International Business Studies 2003, 34:345-355.
15. Cardinal L.B., Opler T.C. Corporate diversification & innovative efficiency: an empirical study. Journal of Accounting and Economics 1995, 19:365-381.
16. Caves R.E. Multinational Enterprise and Economic Analysis 1996, Cambridge University Press, New York. 2nd ed.
17. Chan S., Martin J., Kensinger J. Corporate research and development expenditures and share value. Journal of Financial Economics 1990, 26:255-276.
18. Chandy R.K., Tellis G.J. The incumbent's curse? Incumbency, size, and radical product innovation. Journal of Marketing 2000, 64:1-17.
19. Chaney P.K., Devinney T.M., Winer R.S. The impact of new product introductions on the market value of firms. Journal of Business 1991, 64:573-610.
20. Chang S.J., Singh H. An evolutionary perspective on diversification and corporate restructuring: entry, exit and economic performance during 1981-1989. Strategic Management Journal 2000, 17(8):587-611.
21. Chang S.C., Wang C.F. The effect of product diversification strategies on the relationship between international diversification and firm performance. Journal of World Business 2007, 42:61-79.
22. Chen S.S. Organizational form and the economic impact of corporate new product strategies. Journal of Business Finance and Accounting 2008, 35(1):71-101.
23. Chen S.S., Ho K.W., Ik K.H., Lee C.F. How does strategic competition affect firm values? A study of new product announcements. Financial Management 2002, 31:67-84.
24. Collins J.M. A market performance comparison of U.S. firms active in domestic, developed and developing countries. Journal of International Business Studies 1990, 21(2):271-287.
25. Contractor F.J., Kundu S.K., Hsu C.C. A three-stage theory of international expansion: the link between multinationality and performance in the service sector. Journal of International Business Studies 2003, 34:5-18.
26. Cooper R.G., Kleinschmidt E.J. New products: what separates winners from losers?. Journal of Product Innovation Management 1987, 4(3):169-184.
27. Craig C.S., Douglas S.P. Configural advantage in global markets. Journal of International Marketing 2000, 8(1):6-26.
28. Daniels J.D., Bracker J. Profit performance: do foreign operations make a difference?. Management International Review 1989, 29:46-56.
29. Danneels E. The dynamics of product innovation and firm competences. Strategic Management Journal 2002, 23:1095-1121.
30. Das S., Sen P.K., Sengupta S. Impact of strategic alliances on firm valuation. Academy of Management Journal 1998, 41:27-41.
31. Day G.S. The capabilities of market-driven organizations. Journal of Marketing 1994, 58(3):37-52.
32. Delios A., Beamish P.W. Geographic scope, product diversification, and the corporate performance of Japanese firms. Strategic Management Journal 1999, 20:711-727.
33. Doukas J.A., Lang L.H.P. Foreign direct investment, diversification and firm performance. Journal of International Business Studies 2003, 34:153-172.
34. Dowling G.R., Staelin R. A model of perceived risk and intended risk-handling activity. Journal of Consumer Research 1994, 1(1):119-135.
35. Dunning J.H. The eclectic paradigm of international production: a restatement and some possible extensions. Journal of International Business Studies 1988, 19(1):1-31.
36. Dutta S., Narasimhan O., Rajiv S. Success in high-technology markets: is marketing capability critical?. Marketing Science 1999, 18:547-568.
37. Fama E.F. Efficient capital markets: a review of theory and empirical work. Journal of Finance 1970, 25:383-417.
38. Firth R., Narayanan V. New product strategies of large, dominant product manufacturing firms: an exploratory analysis. Journal of Product Innovation Management 1996, 13:334-347.
39. Francis J., Smith A. Agency costs & innovation: some empirical evidence. Journal of Accounting and Economics 1995, 19:383-409.
40. Garbe J., Richter N.F. Causal analysis of the internationalization and performance relationship based on neural networks-advocating the transnational structure. Journal of International Management 2009, 15:413-431.
41. Gaur A.S., Kumar V. International diversification, business group affiliation and firm performance: empirical evidence from India. British Journal of Management 2009, 20(2):172-186.
42. Gomes L., Ramaswamy K. An empirical examination of the form of the relationship between multinationality and performance. Journal of International Business Studies 1999, 30:173-188.
43. Grant R.M. Multinationality and performance among British manufacturing companies. Journal of International Business Studies 1987, 18(3):79-89.
44. Healy P.M., Palepu K.G., Ruback R.S. Does corporate performance improve after mergers?. Journal of Financial Economics 1992, 31(2):135-175.
45. Helsen K., Jedidi K., DeSarbo W.S. A new approach to country segmentation utilizing multinational diffusion patterns. Journal of Marketing 1993, 57:60-71.
46. Hendricks K.B., Singhal V.R. Delays in new product introductions and the market value of firm: the consequences of being late to the market. Management Science 1997, 43:422-436.
47. Hill C.M.L., Snell S.A. External control, corporate strategy and firm performance in research intensive industries. Strategic Management Journal 1988, 9:579-590.
48. Hirsch S., Lev B. Sales stabilization through export diversification. Review of Economic and Statistics 1971, 53:258-266.
49. Hitt M.A., Hoskisson R.E., Johnson R.A., Moesel D.D. The market for corporate control & firm innovation. Academy of Management Journal 1996, 39:1084-1119.
50. Hitt M.A., Hoskinsson R.E., Kim H. International diversification and firm performance in product-diversified firms. Academy of Management Journal 1997, 40(4):767-798.
51. Hoskisson R.E., Harrison J.S., Dubofsky D.A. Capital market evaluation of m-form implementation and diversification strategy. Strategic Management Journal 1991, 12:271-279.
52. Hymer S.H. A Study of Direct Foreign Investment 1976, MIT Press, Cambridge, MA.
53. Inkpen A.C. Learning through joint ventures: a framework of knowledge acquisition. Journal of Management Studies 2000, 37(7):1019-1043.
54. Jacquillat B., Solnik B. Multinationals are poor tools for diversification. Journal of Portfolio Management 1978, 4(2):8-12.
55. Jensen M.C. Agency costs of free cash flow, corporate finance, and takeovers. The American Economic Review 1986, 76:323-329.
56. Jovanovic B., MacDonald G.M. The life cycle of a competitive industry. Journal of Political Economy 1994, 102:322-347.
57. Kale P., Dyer J.H., Singh H. Alliance capability, stock market response, and long-term alliance success: the role of the alliance function. Strategic Management Journal 2002, 23:747-767.
58. Kalyanaram G., Robinson W.T., Urban G.L. Order of entry: established empirical generalizations, emerging empirical generalizations, and future research. Marketing Science 1995, 14(3):G212-G221.
59. Kelm K.M., Narayanan V.K., Pinches G.E. Shareholder value creation during R&D innovation and commercialization stages. Academy of Management Journal 1995, 38:770-786.
60. Kim W.C., Hwang P., Burgers W.P. Global diversification strategy and corporate profit performance. Strategic Management Journal 1989, 10:45-57.
61. Kim W.C., Hwang P., Burgers W.P. Multinationals' diversification and the risk-return trade-off. Strategic Management Journal 1993, 14:275-286.
62. Kleinschmidt E., Cooper R. The impact of product innovativeness on performance. Journal of Product Innovation Management 1991, 8:240-251.
63. Kobrin S.J. An empirical analysis of the determinants of global integration. Strategic Management Journal 1991, 12:17-37.
64. Kogut B. Designing global strategies: comparative and competitive value-added chains. Sloan Management Review 1985, 27:15-28.
65. Kogut B., Zander U. Knowledge of the firm and the evolutionary theory of the multinational corporation. Journal of International Business Studies 1993, 24:625-645.
66. Koh J., Venkatraman N. Joint venture formations and stock market reactions: an assessment in the information technology sector. Academy of Management Journal 1991, 34:869-892.
67. Kotabe M. The relationship between offshore sourcing and innovativeness of U.S. multinational firms: an empirical investigation. Journal of International Business Studies 1990, 21:623-638.
68. Kotabe M., Srinivasan S.S., Aulakh P.S. Multinationality and firm performance: the moderating role of R&D and marketing capabilities. Journal of International Business Studies 2002, 33(1):79-97.
69. Krasnikov A., Jayachandran S. The relative impact of marketing, research-and-development, and operations capabilities on firm performance. Journal of Marketing 2008, 72:1-11.
70. Lee H., Smith K.G., Grimm C.M., Schomburg A. Timing, order and durability of new product advantages with imitation. Strategic Management Journal 2000, 21:23-30.
71. Lessard D.R. International portfolio diversification: a multivariate analysis for a group of Latin American countries. Journal of Finance 1973, 28(3):619-633.
72. Lessard D.R. World, country, and industry relationships in equity returns: implications for risk reduction through international diversification. Financial Analysts Journal. 1976, 32(1):32-38.
73. Li H., Atuahene-Gima K. Product innovation strategy and the performance of new technology ventures in China. Academy of Management Journal 2001, 44(6):1123-1134.
74. Lu J.W., Beamish P.W. The internationalization and performance of SMEs. Strategic Management Journal. 2001, 22:565-586.
75. Lu J.W., Beamish P.W. International diversification and firm performance: the S-curve hypothesis. Academy of Management Journal 2004, 47(4):598-609.
76. Lubatkin M., Shrieves R.E. Towards reconciliation of market performance measures to strategic management research. Academy of Management Review 1986, 11:497-512.
77. Meyer M., Roberts E. New product strategy in small technology-based firms: a pilot study. Management Science. 1986, 32:806-821.
78. Miller J.C., Pras B. The effects of multinational and export diversification on the profit stability of U.S. corporations. Southern Economic Journal 1980, 46:792-805.
79. Moorman C. Organizational market information processes: cultural antecedents and new product outcomes. Journal of Marketing Research. 1995, 32:318-335.
80. Moorman C., Slotegraaf R.J. The contingency value of complementary capabilities in product development. Journal of Marketing Research. 1999, 36:239-257.
81. Pauwels K., Silva-Risso J., Srinivasan S., Hanssens D.M. New products, sales promotions, and firm value: the case of the automobile industry. Journal of Marketing. 2004, 68:142-156.
82. Peng M.W., Wang D.Y. Innovation capability and foreign direct investment: toward a learning option perspective. Management International Review. 2000, 40:79-93.
83. Penner-Hahn J., Shaver J.M. Does international research and development increase patent output? An analysis of Japanese pharmaceutical firms. Strategic Management Journal. 2005, 26(2):121-140.
84. Porter M.E. Competition in Global Industries 1986, Harvard Business School Press, Boston.
85. Rabino S., Moskowitz H. The R&D role in bridging new products to the marketplace. The Journal of Business Strategy 1981, 4:26-32.
86. Ramaswamy K. Multinationality, configuration, and performance: a study of MNEs in the U.S. drug and pharmaceutical industry. Journal of International Management. 1995, 1(2):231-253.
87. Reuer J.J. From hybrids to hierarchies: shareholder wealth effects of joint venture partner buyouts. Strategic Management Journal. 2001, 22:27-44.
88. Rugman A., Yip G., Jayaratne S. A note on return on foreign assets and foreign presence for UK multinationals. British Journal of Management. 2008, 19:162-170.
89. Ruigrok W., Amann W., Wagner H. The internationalization-performance relationship at Swiss firms: a test of the s-shape and extreme degrees of internationalization. Management International Review. 2007, 47(3):349-368.
90. Schankerman M., Pakes A. Estimates of the value of patent rights in European countries during the post-1950 period. Economic Journal. 1986, 97:1-25.
91. Solnik B.H. Why not diversify internationally rather than domestically?. Financial Analysts Journal. 1974, 30(4):48-54.
92. Sorescu A.B., Chandy R.K., Prabhu J.C. Sources and financial consequences of radical innovation: insights from pharmaceuticals. Journal of Marketing. 2003, 67:82-102.
93. Srivastava R.K., Shervani T.A., Fahey L. Market-based assets and shareholder value: a framework for analysis. Journal of Marketing. 1998, 62:2-18.
94. Subramaniam M., Venkatraman N. Determinants of transnational new product development capability: testing the influence of transferring and deploying tacit overseas knowledge. Strategic Management Journal. 2001, 22:359-378.
95. Sullivan D. Measuring the degree of internationalization of a firm. Journal of International Business Studies. 1994, 25(2):325-342.
96. Szewczyk S.H., Tsetsekos G.P., Zantout Z. The valuation of corporate R&D expenditures: evidence from investment opportunities and free cash flow. Financial Management. 1996, 25(1):105-110.
97. Szulanski G., Winter S.G. Getting it right the second time. Harvard Business Review 2002, 80:62-69.
98. Tallman S., Li J. Effects of international diversity and product diversity on the performance of multinational firms. Academy of Management Review 1996, 39(1):179-196.
99. Tsai W. Knowledge transfer in intraorganizational networks: effects of network position and absorptive capacity in business unit innovation and performance. Academy of Management Journal 2001, 44(5):996-1004.
100. Williamson P.J. Strategy as options on the future. Sloan Management Review 1999, 117-126. Spring.
101. Yeoh P.L., Roth K. An empirical analysis of sustained advantage in the U.S. pharmaceutical industry: impact of firm resources and capabilities. Strategic Management Journal 1999, 20:637-653.
102. Zaheer S., Mosakowski E. The dynamics of the liability of foreignness: a global study of survival of financial services. Strategic Management Journal. 1997, 18(6):439-464.
103. Zahra S.A., Hayton J.C. The effect of international venturing on firm performance: the moderating influence of absorptive capacity. Journal of Business Venturing. 2008, 23:195-220.