%0 Journal Article %1 Choi2002 %A Choi, Jeong-Pyo %A Cowing, Thomas G. %D 2002 %J Review of Industrial Organization %K 1980 1990 corea sector %N 3 %P 271-282 %T Diversification, Concentration and Economic Performance: Korean Business Groups %V 21 %X The purpose of this paper is to analyze empirically some of the relationships involving corporate diversification, concentration and economic performance for a group of 25 of the largest Korean chaebols or business groups over the period 1985-1995. Using Herfindahl-Hirschman indices of inter-industry diversification and intra-group member firm concentration, our results indicate that increased conglomerate diversification does not affect chaebol profits whereas changes in internal member firm concentration do. Of particular interest with respect to both diversification and concentration are our findings that a quadratic relationship exists between group profits and the number of member firms, with both smaller and larger chaebols having higher profits than intermediate size chaebols. A similar relationship also exists with respect to group size measured in terms of total assets. Since the number of member firms is included as an explanatory variable, our results imply that profitable chaebols expand primarily within their existing industries rather than by adding firms in new markets.

@article{Choi2002, abstract = {The purpose of this paper is to analyze empirically some of the relationships involving corporate diversification, concentration and economic performance for a group of 25 of the largest Korean chaebols or business groups over the period 1985-1995. Using Herfindahl-Hirschman indices of inter-industry diversification and intra-group member firm concentration, our results indicate that increased conglomerate diversification does not affect chaebol profits whereas changes in internal member firm concentration do. Of particular interest with respect to both diversification and concentration are our findings that a quadratic relationship exists between group profits and the number of member firms, with both smaller and larger chaebols having higher profits than intermediate size chaebols. A similar relationship also exists with respect to group size measured in terms of total assets. Since the number of member firms is included as an explanatory variable, our results imply that profitable chaebols expand primarily within their existing industries rather than by adding firms in new markets.}, added-at = {2011-11-13T04:52:20.000+0100}, author = {Choi, Jeong-Pyo and Cowing, Thomas G.}, biburl = {https://www.bibsonomy.org/bibtex/2b6d7187b563cb5aac9c4633470b7449c/edwardyanquen}, interhash = {5599f5da8b7d4f026dbaf2f67314942c}, intrahash = {b6d7187b563cb5aac9c4633470b7449c}, journal = {Review of Industrial Organization}, keywords = {1980 1990 corea sector}, note = {Keywords: Concentration; Conglomerates; Firm; Firms; Geographic Descriptors: S. Korea; Geographic Region: Asia; Publication Type: Journal Article; Update Code: 200303; Copyright: Copyright of Review of Industrial Organization is the property of Springer Science \& Business Media B.V. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use.}, number = 3, pages = {271-282}, timestamp = {2011-11-13T04:52:21.000+0100}, title = {Diversification, Concentration and Economic Performance: Korean Business Groups}, volume = 21, year = 2002 }