African Journal of
Business Management

  • Abbreviation: Afr. J. Bus. Manage.
  • Language: English
  • ISSN: 1993-8233
  • DOI: 10.5897/AJBM
  • Start Year: 2007
  • Published Articles: 4193

Full Length Research Paper

Diversification and firm performance in China

  Hao Shen1, Dong Wang2 and Zhongfeng Su3*  
  1School of Management, Xi’an Jiaotong University, Xi’an, 710049, Shaanxi. P. R. China. 2Media Management School, Communication University of China, Beijing, 100010, P. R. China. 3School of Business, Nanjing University, Nanjing, 210093, Jiangsu, China.  
Email: [email protected]

  •  Accepted: 24 August 2011
  •  Published: 09 November 2011

Abstract

 

This study focuses on the performance implication of diversification in China. It finds that product diversification has an inverse U-shaped relationship with firm performance, while geographic diversification has a U-shaped one. In addition, the interaction between product diversification and geographic diversification has a negative impact on firm performance. The findings not only enrich our knowledge of the value of diversification in China’s transition economy, but also guide Chinese firms on how to use diversification strategy to compete in the market and enhance their performance.

 

Key words: Diversification, performance, China.

Copyright © 2024 Author(s) retain the copyright of this article.

This article is published under the terms of the Creative Commons Attribution License 4.0

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