| This research investigates the statistical impact of headquarters location and industry affiliation on firm performance in diverse settings around the world. Using a large panel dataset covering more than 4,000 firms operating in 43 countries over 11 years, the first paper concludes that both headquarters location and industry affiliation are important to performance, but that the interaction between the two is more significant than each individual impact. This indicates that countries tend to host either high-performing or low-performing firms within particular industries, confirming previous case analyses showing that location has significant performance impact by industry sector. In the second paper, the main objective is to explore the persistence of home-country and industry influences on firm performance during a period over a decade. I estimate the sustainability of country, industry, and country-industry interaction effects through the method of first-order auto-correlation (AR-1), in which the durability of effects on firm profitability is tested using a fixed-effect dynamic panel data method (Hsiao 1986), in conjunction with Nickell's (1981) bias correction and control for the auto-correlation of the residuals (McGahan and Porter 1997). The results show that these performance effects tend to persist in the order of 50% or more from one year to the next. In the third paper, I investigate temporal changes in these performance effects on firm profitability and cautiously suggest that these changes could be directly correlated with the new rules of international trade established by the World Trade Organization and regional economic blocs. This study is done based on the comparison of firm profitability patterns at two different historical moments using a quasi-experimentation methodology. Results show that the home-country effect decreases over time, while the country-industry interaction effect increases. In combination, the three papers show that home-country and industry effects emerge, persist, and eventually change, influencing the overall pattern of distribution in firm profitability. |
