Weitere Kapitel dieses Buchs durch Wischen aufrufen
Chandler, The visible hand: the managerial revolution in American business. Belknap Press of Harvard University Press, Cambridge (1977) and Scale and scope: the dynamics of industrial capitalism. Belknap Press of Harvard University Press, Cambridge (1990) pointed out that an economy of scope and corporate diversification could bring about higher profitability and/or higher productivity. However, many empirical analyses of US corporations have found that corporate diversification has reduced firm value, in so-called “diversification discounts” or “conglomerate discounts.” For example, Wernerfelt and Montgomery, Am Econ Rev, 78(1):246–250, (1988), a pioneering study on diversification discounts, show that corporate performance is inferior in corporations that have diversified broadly compared with corporations that have not. It is often pointed out that inefficient corporate diversification is the result of weak corporate governance. For example, top corporate managers tend to be fonder of large-scale and wide-ranging businesses than of single and small-scale businesses. This propensity is called “empire building.” As the scale and scope of a business expand, top managers tend to dabble in investment projects in which the discounted net present values are negative; this is what is called the “problem of overinvestment.” Furthermore, in project selection, top managers have a strong tendency to choose projects that coincide exactly with their own specific skills and experiences instead of projects that are suitable and manageable for other managers; this is the so-called “problem of entrenching investment.” To solve these negative aspects of corporate diversification resulting from weak corporate governance, mechanisms for monitoring and controlling top managers’ behavior effectively are required.
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Chandler, A. D, Jr. (1977). The visible hand: The managerial revolution in American business. Cambridge, Mass: Belknap Press of Harvard University Press.
Chandler, A. D, Jr. (1990). Scale and scope: The dynamics of industrial capitalism. Cambridge, Mass: Belknap Press of Harvard University Press.
Hanazaki, M., & Liu, Q. (2003). The Asian crisis and corporate governance. In M. Hanazaki & J. Teranishi (Eds.), An economic analysis of corporate governance: Japan and East Asia in a changing environment (pp. 339–368). Tokyo: University of Tokyo Press. (in Japanese).
Itoh, H., Kikutani, T., & Hayashida, O. (2003). Many-sided relationship between the parent companies and their subsidiaries. In M. Hanazaki & J. Teranishi (Eds.), An economic analysis of corporate governance: Japan and East Asia in a changing environment (pp. 52–80). Tokyo: University of Tokyo Press. (in Japanese).
Jensen, M. C. (1986). Agency costs of free cash flow, corporate finance and takeovers. American Economic Review, 76(2), 323–329.
Kikutani, T., Itoh, H., & Hayashida, O. (2007). Business portfolio restructuring of Japanese firms in the 1990s: Entry and exit analysis. In M. Aoki, G. Jackson, & H. Miyajima (Eds.), Corporate governance in Japan: institutional change and organizational diversity (pp. 227–256). New York: Oxford University Press. CrossRef
Lang, L. H. P., & Stulz, R. M. (1994). Tobin’s q, corporate diversification, and firm performance. Journal of Political Economy, 102(6), 1248–1280. CrossRef
Miyajima, H., & Inagaki, K. (2003). Diversified corporate behaviors and corporate governance. Policy Research Institute, Ministry of Finance. (in Japanese).
Morikawa, M. (1998). Empirical analysis of new entry to the new business and withdrawal from the current business. RIETI Discussion Paper Series, 98-DOJ-87. (in Japanese).
Shimizu, M., & Miyagawa, K. (2003). New entry, withdrawal, and corporate diversification: the economic analysis based on the industrial statistic data. Tokyo: Keio University Press. (in Japanese).
Shin, H. H., & Stulz, R. M. (1998). Are internal capital markets efficient? Quarterly Journal of Economics, 113(2), 531–552. CrossRef
Wernerfelt, B., & Montgomery, C. A. (1988). Tobin’s q and the importance of focus in firm performance. American Economic Review, 78(1), 246–250.
Yoshiwara, H., Sakuma, A., Itami, H., & Kagono, T. (1981). Diversification strategy of Japanese corporations. Tokyo: Nihon Keizai Shimbun. (in Japanese).
- Related Studies of Corporate Diversification
- Springer Japan
- Chapter 4
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