Using a large sample of diversified firms from 38 countries we investigate the influence of several national-level institutional factors or ‘institutional voids' on the value of corporate diversification. Specifically, we explore whether the presence of frictions in a country's capital...

We show that the value of corporate diversification increased during the 2007–2009 financial crisis. Diversification gave firms both financing and investment advantages. First, conglomerates became significantly more leveraged relative to comparable focused firms. Second, conglomerates' access...

We examine whether and why the value of diversification changed during the 2008–2009 financial crisis. We find that diversified firms increased in value relative to single-segment firms during the crisis, a result that is not driven by the endogeneity of either financing constraints or firms'...