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.
|Number of pages||12|
|Journal||Research in International Business and Finance|
|Early online date||8 Jul 2017|
|Publication status||Published - Dec 2017|
Bibliographical notePublisher Copyright:
© 2017 Elsevier B.V.
- Corporate strategy
- Firm performance
ASJC Scopus subject areas
- Business, Management and Accounting (miscellaneous)