VOLUME XV
SPRING 2007

STRATEGIC HETEROGENEITY AND INDUSTRY PERFORMANCE IN SPANISH MANUFACTURING
 
EDUARDO GONZÁLEZ FIDALGO
JUAN VENTURA VICTORIA

Universidad de Oviedo
 
This paper analyses the relationship between strategic variety and industry performance. From a theoretical perspective, strategic variety may induce a positive effect, by reducing competitive interdependence, or a negative effect, by impairing oligopolistic coordination. The empirical evidence in the literature is scant and contradictory. With these precedents in mind, this paper provides new evidence from a sample of Spanish manufacturing firms representing 55 different industries. The results support the existence of a quadratic U-shaped relationship, suggesting that both industries with high variety and industries with low variety tend to achieve high performance. Conversely, industries that show a moderate level of strategic variety register a lower performance.
 
Key words: strategic variety, performance, strategic groups, industry.
JEL classification: L10, L60, C23.

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