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International diversification and performance in agri-food firms

Author

Listed:
  • Ra�l Serrano

    (Faculty of Economics and Business Studies, Universidad de Zaragoza)

  • Marta Fern�ndez-Olmos

    (Faculty of Economics and Business Studies, Universidad de Zaragoza)

  • Vicente Pinilla

    (Faculty of Economics and Business Studies, Universidad de Zaragoza)

Abstract

: This paper studies the relationship between international diversification and performance in agri-food firms In line with the recent literature, it analyses the effects of the degree of internationalization using a uniform sample, a long-term focus and a measure that combines export intensity and regional diversification. The study empirically confirms the hypothesis of a horizontal S-curve relationship between diversification and performance and identifies three phases. Novice export firms are found in the first stage; their profits are low because they incur in the initial costs of exporting. Mature companies with a more advanced internationalization process are in the second stage; they benefit from the positive outcomes of operating at a larger scale. Lastly, the third stage contains internationally over-diversified companies; their performance decreases as a result of costs to enter extra-regional markets, which are especially steep in this sector, and dealing with greater organisational complexity

Suggested Citation

  • Ra�l Serrano & Marta Fern�ndez-Olmos & Vicente Pinilla, 2015. "International diversification and performance in agri-food firms," Documentos de Trabajo dt2015-01, Facultad de Ciencias Económicas y Empresariales, Universidad de Zaragoza.
  • Handle: RePEc:zar:wpaper:dt2015-01
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    More about this item

    Keywords

    : Agribusiness; International diversification; Firm performance; Degree of Internationalization;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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