Asia Pacific Journal of Management

, Volume 23, Issue 4, pp 419–437 | Cite as

Business groups and their types

  • Alvaro Cuervo-CazurraEmail author


We clarify what business groups are and analyze their various types. We first distinguish business groups from other types of firm networks based on the strategic relationships among companies; business groups are defined as those networks that exhibit unrelated diversification under common ownership. We then separate business groups into three types based on their ownership: family-owned, widely-held, and state-owned. We argue that each type has different agency costs and diversification logics. As a result of these differences, their performance varies, with family-owned business groups outperforming widely-held ones, and these in turn outperforming state-owned business groups.


Business groups Diversification Family-ownership Theory of the firm 


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Copyright information

© Springer Science+Business Media, LLC 2006

Authors and Affiliations

  1. 1.Sonoco Department of International Business, Moore School of BusinessUniversity of South CarolinaColumbiaUSA

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