Is Diversification a Good Strategy for Chinese Tourism Companies

Abstract

Employing a sample of Chinese tourism companies from 2001 to 2007, this study examines the impacts of diversification on their financial performance. Return on equity (ROE) is used to measure the corporate performance. The ratio of tourism revenue to principal revenue, Herfindahl index, and entropy index, are employed to gauge the condition of diversification. Evidence indicates that, taken as a whole, a diversification strategy does improve the performance of tourism companies. Further investigation shows that this finding is only true for the attraction‐operating companies; diversification does not enhance the financial performance for the hotel companies. This study supports the policy of encouraging the attraction‐operating companies not to depend only on natural resources but to look for new ways to improve their performance. 本研究以2001–2007年的中国旅游公司为例，研究多元化经营对公司财务表现的影响。本研究利用股本回报率 (ROE) 衡量公司业绩，并以旅游收入对主要收入比率、赫芬达尔指数 (Herfindahl Index) 及熵指数 (Entropy Index) 测量多元化经营的状况。实证显示，总体上多元化经营策略确实能够改善旅游公司的业绩。但经过深入研究后发现，多元化经营只能够改善旅游景区公司的业绩，对酒店的业绩并没有帮助。本研究认为旅游景区公司不应单纯依赖自然资源，应寻求新方法提升业绩。

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