We use a unique rich newly built data set for German manufacturing enterprises to investigate the product differentiation firm performance relationship. We find that an increase in the degree of product diversification has a negative impact on profitability when observed and unobserved firm...

We use a unique rich newly built data set for German manufacturing enterprises to investigate the relationship between product diversification and the stability of sales and employment. We find that contrary to portfolio theoretic considerations more diversified firms exhibit a higher...