The Effect of Financial Drivers on Product and Geographic Diversification for Listed and Unlisted Firms

Authors

  • Maurizio La Rocca University of Calabria, Dip.to di Scienze Aziendali e Giuridiche, Cubo 3-C, Ponte P. Bucci, 87036 Rende, Cosenza, Italy.
  • Tiziana La Rocca Università di Messina, Dip.to di Economia, Piazza Pugliese, 98122, Messina, Italy.
  • Francesco Fasano University of Calabria, Dip.to di Scienze Aziendali e Giuridiche, Cubo 3-C, Ponte P. Bucci, 87036 Rende, Cosenza, Italy.

DOI:

https://doi.org/10.9734/bpi/niebm/v4/14317D

Keywords:

Diversification, product diversification, geographic diversification, capital markets, information asymmetry, agency costs

Abstract

This paper investigates whether free cash flow arguments or internal capital market perspective explain product and geographic diversification decisions. Using a unique panel of hand-collected data from Italian firms (listed and unlisted) for the period 1980-2010, the results reveal, as a net effect, the predominant role of the internal capital market arguments, especially relevant for the decision to diversify unrelated and for unlisted firms.

Published

2022-01-05

How to Cite

Maurizio La Rocca, Tiziana La Rocca, & Francesco Fasano. (2022). The Effect of Financial Drivers on Product and Geographic Diversification for Listed and Unlisted Firms. New Innovations in Economics, Business and Management Vol. 4, 96–103. https://doi.org/10.9734/bpi/niebm/v4/14317D

Issue

New Innovations in Economics, Business and Management Vol. 4

Section

Chapters