The Pattern and Valuation Effects of Corporate Diversification: A Comparison of the United States, Japan, and Other East Asian Economies

Stijn Claessens (), Simeon Djankov, Joseph P. H. Fan and Larry H. P. Lang

No DP2001-127, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: We document that firms in eight East Asian countries and Japan diversify into more segments and engage into more related businesses―as measured by the degree of vertical relatedness and complementarity―than firms in the USA. Using data for the 1990-6 period, we observe a trend towards complementary diversification in the United States and the eight East Asian countries, and a trend towards more vertical integration in Japan. The increase in relatedness for US firms is due to the divestiture of unrelated assets.

Keywords: Corporations; Regression analysis; Valuation (search for similar items in EconPapers)
Date: 2001
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Citations: View citations in EconPapers (5)

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