Do foreign investments increase firm value and firm performance? Evidence from Japan

Napaporn Likitwongkajon, Chaiporn Vithessonthi

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16 Citations (Scopus)


As empirical evidence on the impact of internationalization on firm performance remains unclear, we revisit the question of whether foreign investments enhance firm value and firm performance. Using a panel sample of publicly listed firms in Japan during the 1990–2016 period, we find that foreign investments are negatively associated with firm value. In addition, foreign investments are negatively related to firm performance at short- and long-horizons. Furthermore, foreign investments appear to reduce revenue growth but have no effect on firm efficiency, suggesting that simply increasing foreign investments does not necessarily enhance revenue growth or firm efficiency.

Original languageEnglish
Article number101099
Number of pages19
JournalResearch in International Business and Finance
Publication statusPublished - Jan 2020
Externally publishedYes


  • Firm performance
  • Firm value
  • Foreign investments
  • Japan
  • Strategy

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