Direct foreign ownership, institutional investors, and firm characteristics

Dahlquist, Magnus

doi:10.1016/s0304-405x(00)00092-1

Cited by 742 publications

(616 citation statements)

References 17 publications

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“…They argue that for this type of firms information frictions are the lowest. Similar results are obtained by Dahlquist and Robertsson (2001) for the case of Sweden. Hau (2001) shows that investors based in Germany and in German speaking cities within Europe have higher profits on German stock.…”

Section: Literature On Determinants Of Foreign Investment and The Pecsupporting

confidence: 78%

The pecking order of cross-border investment

Daude

Fratzscher

2008

Journal of International Economics

226

171

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Section: Literature On Determinants Of Foreign Investment and The Pecsupporting

confidence: 78%

The pecking order of cross-border investment

Daude

Fratzscher

2008

Journal of International Economics

226

171

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“…Studies suggest that reputations associated with greater size may decrease the influence of spatial factors in investment decisions (Coval and Moskowitz, 1999;Dahlquist and Robertsson, 2001;Kang and Stulz, 1997), while larger firms may have greater information-gathering resources (Green and Cromley, 1984). However, column 4 shows that acquirer size had no effect on the proximity preference, which cross-derivative calculations confirmed.…”

Section: Resultssupporting

confidence: 55%

The Persistent Effect of Geographic Distance in Acquisition Target Selection

Chakrabarti

Mitchell

2013

Organization Science

155

151

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Valuable resources often exist at distant points from a firm's current locations, so that strategic decisions such as growth have a spatial dimension in which firms seek information and choose between geographically distributed alternatives. Studies show that geographic proximity facilitates the flow of resources, but there is limited understanding of factors that exacerbate or ease the impact of geographic distance when firms seek new resources. This paper argues that the difficulty of search increases with distance, particularly when search involves greater information processing, but that firms can partially overcome the constraints of distance with direct, contextual, and vicarious learning. We study 2070 domestic acquisition announcements by U.S. chemical manufacturers founded after 1979. The results demonstrate the persistent effect of spatial geography on organizational search processes.

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“…For example, Kang and Stulz (1997) find that foreign investors in Japan overallocate their portfolios to firms with low unsystematic risk. Dahlquist and Robertsson (2001), on the other hand, report that percentage ownership held by foreign investors is not significantly related to either beta or idiosyncratic volatility, after controlling for other firm characteristics.…”

Section: Endogeneitymentioning

confidence: 99%

Large Foreign Ownership and Firm-Level Stock Return Volatility in Emerging Markets

Li¹,

Nguyễn²,

Pham³

et al. 2011

J. Financ. Quant. Anal.

147

110

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This study constructs a firm-level measure of large foreign ownership (LFO) and investigates its impact on stock return volatility in 31 emerging markets. We find a negative relationship between LFO and volatility, even after controlling for potential endogeneity and the impact of major domestic shareholders. This suggests a stabilizing role of LFO in emerging markets, which is consistent with previous suggestions in the literature on the strong commitments and potential monitoring role of large foreign shareholders. Overall, our study highlights the importance of recognizing the heterogeneity among foreign investors and the benefits of large foreign shareholders to emerging stock markets.

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Direct foreign ownership, institutional investors, and firm characteristics

Cited by 742 publications

References 17 publications

The pecking order of cross-border investment

The pecking order of cross-border investment

The Persistent Effect of Geographic Distance in Acquisition Target Selection

Large Foreign Ownership and Firm-Level Stock Return Volatility in Emerging Markets

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