An Empirical Study On The Relationship Between Diversification And Economic Performance Of Listed Corporations Of China

Agriculture is the basis of China's national economy,as a leading enterprise business,the strategy of listed agriculture company will affect the entire agricultural industry. However,as agricultural enterprises, because of their own inferiority, they are seriously affected by natural factors,long investment cycle slow effect and less profitable.All the listed agricultural companies have begun to carry out diversified strategy of operation with the goal to disperse risks of operation and search for the high-speed development.Can diversification truly improve the performance of listed agricultural companies?Based on consideration of this issue,this paper has analyzed the correlation between the performance and the diversified operation of listed agricultural companies.This paper based on related theories of the diversified operation and the performance about listed agricultural companies both at home and abroad,which has taken annual report data of china listed agricultural companies announced in 2008 as the sample,both from a financial and marketing performance measurement ,the performance indicators as the dependent variable , while the firm size , firm age , asset-liability ratio as control variables.Then we use analysis of variance and multiple regression statistical methods,to measure the level of its diversification operating, and analyse the correlation between different levels of diversification and firm performance.We found that the diversity degree of agricultural listed companies, earnings per share,return on equity and return on assets were more significant negative correlation.while the market indicators Tobin's Q is not significant with diversity levels.Finally,the paper brings up relevant policy-related suggestions,combined with the empirical fruits and the practical circumstance.