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Corporate Performance And Cost Of Capital Differentials Of Firms With Different Organizational Forms, Ibrahim Siraj
Corporate Performance And Cost Of Capital Differentials Of Firms With Different Organizational Forms, Ibrahim Siraj
University of New Orleans Theses and Dissertations
In chapter 1, I provide evidence against the claim in the conventional literature on corporate diversification discount that the diversification effect is homogeneous across the industries. I argue that the responsiveness of consumer demand to the changing economic conditions or the product demand sensitivity is an important characteristic of the industries that should be considered to have a more complete understanding of the issue of underperformance of diversified firms compared to single-segment firms. Differentiating industries based on the measure of product demand sensitivity, I show that the diversification effects are not to be homogeneous across the industries. Much of the …