Diversified Company Performance: Evidence from the United States Airline Industry
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Abstract
This paper analyzes the effect related diversification strategy has on firm performance. Based on a sample of 70% of US airlines, this piece of research investigates the relationship between the degree of diversification and corporate profitability. Multiple linear regression models of panel data (i.e., 6 years) were tested, with model parameters estimated by the Generalized Method of Moments (GMM) technique. We identified that firm performance followed an inverted-U curvilinear pattern. That is, boundary-spanning activities of related diversified firms increase coordination efforts to the extent that, at some point, the benefits of this strategy are offset.
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How to Cite
Barros, H. M., Bortoluzzo, A. B., & Arruda, L. M. de C. (1). Diversified Company Performance: Evidence from the United States Airline Industry. Journal of Contemporary Administration, 22(1), 23-45. https://doi.org/10.1590/1982-7849rac2018160123
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