The Effect of Corporate Diversification on Firm Value: In the Presence of Financial Crisis
This paper examines the value of corporate diversification during 2001 and 2015. Analysis of firms’ excess value with differences-in-differences model reveals a significant diversification discount over the pre-crisis period while it turns to positive after the crisis. The value increased in diversi...
| Main Author: | |
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| Format: | Dissertation (University of Nottingham only) |
| Language: | English |
| Published: |
2016
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| Online Access: | https://eprints.nottingham.ac.uk/36920/ |
| _version_ | 1848795359759826944 |
|---|---|
| author | Li, Zhi |
| author_facet | Li, Zhi |
| author_sort | Li, Zhi |
| building | Nottingham Research Data Repository |
| collection | Online Access |
| description | This paper examines the value of corporate diversification during 2001 and 2015. Analysis of firms’ excess value with differences-in-differences model reveals a significant diversification discount over the pre-crisis period while it turns to positive after the crisis. The value increased in diversified firms becomes significant since the model is corrected for self-selection issues. However, I do not find the evidence on the hypothesis that the same relationship between diversified firms and focused firms would remain for unrelated and related diversifiers. Therefore, I propose that the value of firm may not necessarily link to the degree of diversification, suggesting diversifiers should strike a balance between diversification and specialization especially for the year of recession. |
| first_indexed | 2025-11-14T19:30:50Z |
| format | Dissertation (University of Nottingham only) |
| id | nottingham-36920 |
| institution | University of Nottingham Malaysia Campus |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T19:30:50Z |
| publishDate | 2016 |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | nottingham-369202017-10-19T17:04:48Z https://eprints.nottingham.ac.uk/36920/ The Effect of Corporate Diversification on Firm Value: In the Presence of Financial Crisis Li, Zhi This paper examines the value of corporate diversification during 2001 and 2015. Analysis of firms’ excess value with differences-in-differences model reveals a significant diversification discount over the pre-crisis period while it turns to positive after the crisis. The value increased in diversified firms becomes significant since the model is corrected for self-selection issues. However, I do not find the evidence on the hypothesis that the same relationship between diversified firms and focused firms would remain for unrelated and related diversifiers. Therefore, I propose that the value of firm may not necessarily link to the degree of diversification, suggesting diversifiers should strike a balance between diversification and specialization especially for the year of recession. 2016 Dissertation (University of Nottingham only) NonPeerReviewed application/pdf en https://eprints.nottingham.ac.uk/36920/1/Dissertation.pdf Li, Zhi (2016) The Effect of Corporate Diversification on Firm Value: In the Presence of Financial Crisis. [Dissertation (University of Nottingham only)] |
| spellingShingle | Li, Zhi The Effect of Corporate Diversification on Firm Value: In the Presence of Financial Crisis |
| title | The Effect of Corporate Diversification on Firm Value:
In the Presence of Financial Crisis |
| title_full | The Effect of Corporate Diversification on Firm Value:
In the Presence of Financial Crisis |
| title_fullStr | The Effect of Corporate Diversification on Firm Value:
In the Presence of Financial Crisis |
| title_full_unstemmed | The Effect of Corporate Diversification on Firm Value:
In the Presence of Financial Crisis |
| title_short | The Effect of Corporate Diversification on Firm Value:
In the Presence of Financial Crisis |
| title_sort | effect of corporate diversification on firm value:
in the presence of financial crisis |
| url | https://eprints.nottingham.ac.uk/36920/ |