Organizational Form and the Economic Impact of Corporate New Product Strategies
Journal
Journal of Business Finance and Accounting
Journal Issue
5
Pages
70-101
Date Issued
2008
Author(s)
Abstract
Abstract: This paper examines the role of organizational form in explaining the economic impact of corporate new product strategies. I find that the wealth effects associated with the announcements of new product introductions are more favorable for introducing firms with focused activities than for those with diversified activities. The results hold even after controlling for other factors suggested in the literature that could affect the value of new product introductions. The findings in this study suggest that the efficient investment hypothesis dominates the internal capital markets hypothesis in terms of the net economic impact of new product introductions on the introducing firms.
SDGs
Type
journal article