Abstract

A study is presented that examines the relationship of performance with product and international diversification on Japanese multinational firms from 1977 to 1993. The relationships between diversification and performance are shown to change over time through the use of multiple time periods and accounting for keiretsu membership. Results show that while diversity strategies vary between keiretsu and non-keiretsu firms, performance is not much different. Across time periods, performance varies considerably, but strategies are less variable. Product diversity has weak effects on firm performance only in one time period, while international diversification has negative profitability and positive growth consequences in some periods. These results suggest first that diversification strategies and their effects on performance vary across time periods but generally produce some unexpected findings. Strong interactive diversity effects are not found.

Document Type

Article

Publication Date

1-2000

Publisher Statement

Copyright (C) 2000 John Wiley & Sons, Ltd.

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