Out of Comfort Zone? The Relationship between Outward Investment and Performance for Taiwanese Companies

• Main Authors: YANG, CHENG-HUNG, 楊正鴻
• Other Authors: PAN, WEI-HWA
• Format: Others
• Language: en_US
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/85459657602753273227

碩士 === 國立雲林科技大學 === 企業管理系 === 104 === After 1980s, rising production costs and awareness for environmental protection, Taiwanese firms began to conduct outward investment abroad. However, that Taiwanese outward investments have been highly concentrated in mainland China has cast certain concern. This study explorers this issue by distinguishing outward investment regions into those in approximative and non-approximative regions investment by the perspective of “Liability of Foreignness” (LOF), which examines the influence between different outward investment regions and performance. Also, to provide a better solid foundation, this study investigates the different results by industry. Internationalization and product diversification are served as moderators to examine their influence to outward investment and performance. Finally, this study concludes the relationship of different configuration of both regions and moderators performance. This study applies panel regression of generalized least squares model (GLS) and multilevel model (MLM) to test the sample of 6783 observations from 544 listed firms in 18 different industries dated from 2002 to 2015. The empirical results show the inverted U-shaped relationship between the levels of approximative region investment and performance, and J-shaped relationship between the levels of non-approximative region investment and performance. Better performance can be achieved for firms in higher degree of internationalization. Product diversification suggest a discount effect. The firms in lower degree of product diversification are outperformed than those in higher higher degree. There is better performance at the configuration of high degree of internationalization and low or high level of non-approximative region investment, as well as, at the configuration of low degree of product diversification and medium level of approximative region investment. As for industry, semiconductor industry is the best performer in outward investment, while optoelectronic industry is the worst one.