Corporate restructuring in the United Kingdom and West Germany : recent developments in large non-financial companies
This thesis investigates recent corporate restructuring trends among large non-financial companies from the UK and West Germany. Following an introduction in chapter 1, chapter 2 examines the structure of firms, both historically, and from a transaction cost economic perspective. In chapters 3 to 5, empirical evidence on corporate restructuring in large non-financial companies in the UK and West Germany is provided. Chapter 3 reports on the results of a questionnaire survey in which a total of 116 UK and West German companies took part. It is found that, from 1986 to 1996, companies from both countries have engaged in restructuring, but that corporate restructuring has started earlier, and has been taken further, among the respondents from the UK than among the respondents from West Germany. Chapter 4 focuses on changes in the degree of diversification of companies. The measurement of diversification is discussed. Two data sets are used to calculate diversification indices for companies from the two countries. Evidence is found that companies from the UK have decreased their degree of diversification between 1988 and 1995. West German companies have started to reduce diversification only after 1992. In chapter 5, a comparative case study of two large chemical companies, ICI pic in the UK and Hoechst AG in West Germany, is presented. It is found that corporate restructuring has started earlier at ICI than at Hoechst. Various reasons for the difference in the onset of corporate restructuring are discussed. In Chapter 6, an interpretative approach to the cross-national differences in the timing and the extent of corporate restructuring in the two countries is developed. It is argued that country-specific institutional and economic factors account for these differences, and four sets of these factors are explored. Finally, the findings of the investigation are evaluated and future directions of research outlined.