We examine the value of multinationality to investors as reflected in firms’ q ratios. The positive impact of research and development and advertising spending on a firm’s q is enhanced by multinationality, but multinationality itself has no significant impact. This supports the internalization theory’s prediction that intan- gible assets are necessary to justify direct foreign investment and, thus, a recent strand of trade literature that assumes multinational firms have intangible assets with public good properties. Our results do not support the hypothesis that investors value multinational firms as a means of diversifying their portfolios internationally. Journal ofBusiness, Vol. 64, No. 2 (April 1991), pp. 165-87. (Reprinted with permission of the University of Chicago.)