The Future of Business Groups in Emerging Markets: Long Run Evidence from Chile
Harvard University - Strategy Unit
Harvard University - Harvard Business School; Harvard University - David Rockefeller Center for Latin American Research; Harvard Business Review; NBER
We demonstrate variation in the extent to which firms benefit from their affiliation with Chilean business groups in the 1988-1996 period. The net benefits of unrelated diversification are positive if group diversification exceeds a threshold level, though this threshold increases with time. We find evidence of non-diversification related group benefits, which atrophy over time. We conjecture that the evolution of institutional context alters the value creating potential of business groups, though it does so slowly.
Number of Pages in PDF File: 45
JEL Classification: L2, G3, P5working papers series
Date posted: January 26, 1999
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