The Politics of Business Group Diversification in Vietnam Open Access

Le, Ly Ngoc (2013)

Permanent URL:


One of the most salient features of the Vietnamese economy is the state-owned business
groups that unsuccessfully expand into unrelated business activities but are allowed to dominate the
economy at the expense of the private sector. I argue that the persistent dominance of business groups
in Vietnam stems from two main factors: political fragmentation and natural resource abundance. These
two factors independently lead to the persistence of diversification strategies that underscore
economies of scale rather than economies of scope. Moreover, natural resources also act as an
intervening factor between political factions and unrelated diversification. In other words, natural
resource abundance fuels fragmentation in the government which in turn prompts firms to expand into
non-core markets. The study goes on to illustrate the theory by examining the Vietnam Electricity
Corporation (EVN), one of the thirteen general corporations in Vietnam in 2011.

Table of Contents

Abstract 1

I. Introduction 1

II. The significance of the puzzle 3

III. Literature review 6

IV. Theory 11

V. Research design 13

VI. Typology of business groups 16

VII. Empirical evidence: Implications for Vietnam 22

VIII. Conclusion 47

Works Cited 48

About this Master's Thesis

Rights statement
  • Permission granted by the author to include this thesis or dissertation in this repository. All rights reserved by the author. Please contact the author for information regarding the reproduction and use of this thesis or dissertation.
  • English
Research Field
Committee Chair / Thesis Advisor
Committee Members
Last modified

Primary PDF

Supplemental Files