Restructuring Scope, Performance and R&D Intensity: Do All Restructuring Activities Create Value?(1‪)‬

ABSTRACT One of the most prominent aspects of corporate behavior during the 1980s was corporate restructuring--changes of business portfolios through a high level of acquisitions and divestitures. However, little attention has focused on the consequences of restructuring activities. This paper investigated the impact of corporate restructuring activities on a firm's financial performance and long-term competitiveness during 1980s. In comparing a sample of nonrestructured firms, this study found that there are no significant performance differences between restructured and nonrestructured firms and the impacts of corporate restructuring vary depending on restructuring scope. Additionally, there exists a partial substitution relationship between restructuring scope and R&D intensity.