International Dispersion and Profitability: An Institution-Based Approach

This study examines the effect of international dispersion on profitability. We use an institution-based approach to propose that increases in international dispersion lead, on average, to profitability downturns. We also argue that this liability of foreignness will affect multinationals from infrastructure industries to a lesser extent because in these industries: (1) the importance of cultural fit in products is low; (2) firms possess...