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Lookup NU author(s): Professor Nils BraakmannORCiD
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We use unique rich data for German manufacturing enterprises to investigate the product diversification firm performance relationship. We find that an increase in the degree of product diversification has a negative impact on profitability when observed and unobserved firm characteristics are controlled for. The effects are statistically significant and large from an economic point of view. This helps to understand the fact that nearly 40 percent of all enterprises with at least 20 employees are single-product firms according to a detailed classification of products, and that multi-product enterprises with a large number of goods are a rare species.
Author(s): Braakmann N, Wagner J
Publication type: Article
Publication status: Published
Journal: Jahrbuecher fuer Nationaloekonomie und Statistik
Print publication date: 01/06/2011
ISSN (print): 0021-4027
Publisher: Lucius und Lucius Verlagsgesellschaft mbH