Using a sample of 27,287 firm-years over the period of 1983-1993 we document an increasing trend in both the incidence and level of global diversification over time. This trend does not, however, reflect a substitution of global for industrial diversification. Global diversification results in average valuation discounts of the same magnitude as those for industrial diversification. Analysis of the changes in excess value associated with changes in diversification status reveals that increases in global diversification reduce excess value, while reductions in global diversification increase excess value.
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