IDEAS home Printed from https://ideas.repec.org/a/cup/buspol/v8y2006i01p1-19_00.html
   My bibliography  Save this article

Ownership Structure and Corporate Diversification

Author

Listed:
  • Zhang, Yi
  • Li, Xi

Abstract

This paper examines the motivation and impact of corporate diversification in Chinese listed firms. We find that in local government owned-firms there is a non-linear relationship between the level of firm diversification and state ownership. As state ownership increases from zero, the level of diversification decreases. After state ownership reaches a certain level, the level of diversification increases as state ownership increases. There is no evidence that ownership is related to corporate diversification in non-state-owned firms or central government-owned firms. We also document that diversification is negatively related to firm performance in local government-owned firms. However, there is no evidence that diversification is negatively related to the firm performance in non-state-owned firms or central government-owned firms. Our findings suggest that agency problems are responsible for local government owned-firms taking value-reducing diversification strategies.

Suggested Citation

  • Zhang, Yi & Li, Xi, 2006. "Ownership Structure and Corporate Diversification," Business and Politics, Cambridge University Press, vol. 8(1), pages 1-19, April.
    • Handle: RePEc:cup:buspol:v:8:y:2006:i:01:p:1-19_00
    as

    Download full text from publisher

    File URL: https://www.cambridge.org/core/product/identifier/S1369525800001133/type/journal_article
    File Function: link to article abstract page
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ducassy, Isabelle & Prevot, Frédéric, 2010. "The effects of family dynamics on diversification strategy: Empirical evidence from French companies," Journal of Family Business Strategy, Elsevier, vol. 1(4), pages 224-235, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cup:buspol:v:8:y:2006:i:01:p:1-19_00. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kirk Stebbing (email available below). General contact details of provider: https://www.cambridge.org/bap .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.