Microsoft Word 2007 ichrie conference Proceedings Final-Final 06-06-07. doc

 
2007 Annual International CHRIE Conference & Exposition 
140
transferring intangible assets such as patents, franchising rights, or brand names between sub-business units. 
Therefore, intangible assets, surrogated by the ratio intangible assets to total assets, was included in equation 1 to 
control for capital structure’s influence on profitability. 
Table 1 
Summary of equations and corresponding variables
Controlling variable 
Measurement 
Eq (1) 
Eq (2) 
Eq (3) 
Internationalization 
international revenues / total revenues 
D 
I 
I
Leverage
long-term debt / total assets 
I 
D 
I 
Profitability ROA 
D 
Size ln(sales) 
C 
C 
C 
Risk
ln(standard deviation of 3-year EBIT) 
C 
C 
C 
Growth potential 
ln(market value / book value) 
C 
C 
Asset structure 
PPE / total assets 
C 
Intangible assets 
Intangible assets / total assets 
C 
Note: D: dependent variable; I: independent variable of interest; C: controlling variable