Capital expenditure and firm value in the MENA region: the role of market competition and information asymmetry

Harit Satt, Youssef Chetioui, Omar Ouahidi, Virginia Bodolica and Diae Lamiri

Macroeconomics and Finance in Emerging Market Economies, 2025, vol. 18, issue 1, 138-157

Abstract: This paper examines the relationship between capital expenditure and firm value in the MENA region, and the moderating role that market competition and information asymmetry play in this relationship. The study consists of 3,930 observations that include yearly data from the 2010–2019 period. Empirical tests show that in markets of high product competition, capital expenditure exerts a negative effect on firm value, while under the condition of high information asymmetry, this effect is positive. The results also suggest that the hypothesized relationships are stronger for small-sized firms and for Shariah-non-compliant companies.

Date: 2025
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DOI: 10.1080/17520843.2022.2163564

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