The Impact of Diversification Strategies and Economic Development on Performances: an Empirical of Taiwan and China

Abstract

Previous studies focus on the effect of different diversification strategies on performances With the prosperity of emerging markets some studies points out that because of the different external environments the same diversification strategy may results in the different performances in different economic markets Therefore this article chooses Taiwan and China as the representatives of developed markets and emerging markets Then this article compares corporate performance of different diversification strategies across different economies and examines which diversification strategies for different stages of development in economies can foster better corporate performance and steward corporate Additionally this article considers that the best diversification strategy may differ from different industries Therefore this article only focuses on single industry food and beverages industry Our Empirical results shows that related diversification brings better performances for firms in China and its performances is better than firms taking the same strategy in Taiwan Unrelated diversification brings better performances for firms in Taiwan and its performances is better than firms taking the same strategy in China area This study suggests that because of those differences such us market of products the relationship between business and government financial market even though firms are in the same industry they should not only consider their internal factors such as financial condition but those external factors when they decide to take the strategies of related diversification or unrelated diversification

Date of Award	2014 Feb 13
Original language	English
Supervisor	Hsin-Hong Kang (Supervisor)