مقاله سال ۲۰۱۶

 مجله امگا – Omega

In economics, it is well known that the market structure and number of firms in the industry are directly linked to specialization and/or diversification phenomena. While labor division and the specialization of units facilitate technical progress and productivity enhancements, diversification is recognized as a factor of a scope economy linked to environmental synergies between different firms’ activities and risk-management strategies. Economies of scope are defined as cost savings resulting from producing jointly many goods by one diversified firm rather than producing them separately by several specialized firms [30,5]. 1 In some industries, however, economies of scope do not necessarily imply an absence of the benefits of specialization (vice versa). Indeed, specialization and diversi- fication processes can coexist and must collide. So a relevant question is: Between specialization and diversification, which process generates the most gains for firms and is the most economically justifiable?

he most gains for firms and is the most economically justifiable? In this context, the development of tools to disentangle the two processes and assess cases in which one process economically dominates the other is a major methodological challenge. As such, this paper provides new insights into the diversification and specialization phenomena. More precisely, we measure and compare the potential gains in terms of cost reduction that firms may realize with a higher degree of specialization or diversification. We further decompose the gains obtained from the two types of reorganization – division and merger – into technical, size and mix gains. Explicit analysis of gains is an important task in determining the best direction to steer the reorganization (e.g., a division or a merger with or without mix changes). Moreover, by examining the output mix effect, we can determine whether the firm should go toward more specialized or mixed activities and compute the potential gains from the specialization and diversification processes.

To measure the potential gains a priori due to a merger, our approach is quite similar to the one adopted by Bogetoft and Wang [7] or Kristensen et al. [26]. Following these authors, we also employ the same concept of mix to capture the effect of this reorganization. However, our study differs from the above papers and others (e.g., [18,23,15,16]) in two important respects. First, in addition to the merger, we also examine the division process by relying on the methodology developed by Blancard et al. [3] for quantifying potential gains. Second, we estimate these two types of gains using non-convex technologies. Indeed, as Farrell [20] stated and Cherchye and Post [14] re-expressed, the convexity assumption that implies additivity and divisibility does not allow the highlighting of gains achieved through specialization and can only reveal economies of scope. More recently, Sahoo and Tone [38] recalled that the convexity assumption of production technologies might be prejudicial in real-life case studies. Carvalho and Marques [9] also emphasized that the imposition of convexity led to the results which support economies of scope. Hence they proposed a novel approach based on partial frontier nonparametric methods. This second point, which consists of rejecting this assumption, allows us to deviate from Ray [34] and Peyrache [31] in particular.