Diversification strategy, efficiency, and firm performance: Insight from emerging market

Alex Kwaku Gyan, Rayenda Brahmana, Abdul Karim Bakri

Research output: Contribution to journalArticlepeer-review

29 Citations (Scopus)


We investigate further the inconsistencies of the diversification-performance link by introducing efficiency as moderating factor. A data of 319 firms was used to conduct a panel data analysis excluding the financial sector industries and the results show three important findings. First, industrial diversification shows a significant contribution in performance improvement while international diversification shows no effect on performance. Yet, international-conglomerate shows a significant negative relationship with performance. Meanwhile, the efficiency results are contrary to our conjecture. We find that efficiency is a factor to enhance performance, but it is not the moderating variable on the diversification-performance link. This implies that the efficiency of the firm has no connection with the link between diversification and performance.

Original languageEnglish
Pages (from-to)1103-1114
Number of pages12
JournalResearch in International Business and Finance
Early online date8 Jul 2017
Publication statusPublished - Dec 2017
Externally publishedYes

Bibliographical note

Publisher Copyright:
© 2017 Elsevier B.V.


  • Corporate strategy
  • Diversification
  • Efficiency
  • Firm performance

ASJC Scopus subject areas

  • Business, Management and Accounting (miscellaneous)
  • Finance


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