Corporate Diversification of British and German Non-Financial Firms
The IUP Journal of Managerial Economics, Vol. IX, No. 2, pp. 23-33, May 2011
Posted: 8 Mar 2012
Date Written: March 8, 2012
Empirical studies are yet to answer the basic question regarding why firms diversify and what affects this choice. The present study attempts to answer this question using data from British and German firms. The results show different effects of ownership concentration and financial variables on the decision to diversify. It is also observed that in the UK, diversification reduces firm performance, while in Germany, diversification improves firm performance.
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