Internationalization and investment-cash flow sensitivity: Evidence from Taiwan

Abstract

The primary goal of this study was to investigate how the degree of internationalization affects firms' investment-cash flow sensitivity (ICFS) using a sample of Taiwanese listed firms. Our empirical results indicate that a higher degree of internationalization tends to lower its ICFS. Moreover, our findings also suggest that there is no significant difference between group-affiliated firms and unaffiliated firms in the relationship between internationalization and firms’ ICFS. The findings contribute to the financial literature by clarifying internationalization, ICFS and business groups.