This article examines the phenomenon of profit redistribution in Indian business groups and relates redistribution with the underperformance of group-affiliated firms relative to unaffiliated firms. The study also documents that profit redistribution is more pronounced in groups of large sizes...

This article examines how heterogeneous features among business groups influence the corporate diversification–firm performance relationship. The study classifies heterogeneity along three dimensions: group size, group diversity, and share ownership. Using a sample of firms from India, the...

A controversy exists on the use of the investment-cash flow sensitivity as a measure of financing constraints of firms. We re-examine this controversy by analyzing firms affiliated to Indian business groups. We find a strong investment-cash flow sensitivity for both group-affiliated and...