Investment–cash flow sensitivities of restaurant firms: A moderating role of franchising

• Serin Choi ^[4] ; Seoki Lee ^[3] ; Kyuwan Choi ^[2] ; Kyung-A Sun ^[1]
  1. [1] Temple University

     Temple University

     City of Philadelphia, Estados Unidos

     
  2. [2] Kyung Hee University

     Kyung Hee University

     Corea del Sur

     
  3. [3] Pennsylvania State University

     Pennsylvania State University

     Borough of State College, Estados Unidos

     
  4. [4] Korea Food Research Institute

     Korea Food Research Institute

     Corea del Sur

     

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• Localización: Tourism economics: the business and finance of tourism and recreation, ISSN 1354-8166, Vol. 24, Nº. 5, 2018, págs. 560-575
• Idioma: inglés
• Texto completo no disponible (Saber más ...)
• Resumen

  • Although some theories argued that investment decisions are irrelevant to financing decisions under the assumption of perfect market, investment decisions and capital structure seem interdependent in real-world circumstances. Further, the past literature also suggested a close relationship between internal cash flows and investment decisions, that is, investment–cash flow sensitivity (ICFS), but this issue has not been closely examined in the restaurant setting. Therefore, the current study first proposes to examine ICFS in the context of the restaurant industry. More importantly, this study also examines a moderating role of franchising to better explain ICFS, considering a major role of franchising in the restaurant industry, based on theories of pecking order, resource scarcity, and risk sharing. Findings of the current study deepens the understanding of ICFS via franchising, making meaningful contributions to not only to existing ICFS literature but also restaurant franchising literature.