Table 2

Diversification and growth opportunity [estimated based on Equation 1]

Dependent variables: growth opportunity (Q)
12
Constant−1.365** (0.020)−3.983*** (0.001)
Diversification indexes
HERF−1.869 (0.109) 
HERF23.001* (0.060) 
Total entropy −1.998 (0.107)
Total entropy2 1.750** (0.046)
Control variables
SIZE0.236*** (0.000)0.423*** (0.000)
LDTA−1.118** (0.036)−2.808** (0.012)
Number of Obs270270
Adjusted R square0.1430.096
Sargan test: p-value0.3170.287
M2: p-value0.3450.321
Durbin–Watson1.9812.140

Note(s): Figures in parentheses are probability values based on White robust standard errors for heteroskedasticity. *, **, *** denote statistically significance at 1, 5 and 10% level, respectively. m2 is a serial correlation test of second-order using residuals of first differences, asymptotically distributed as N(0,1) under null hypothesis of no serial correlation. Sargan test is a test of overidentifying restrictions distributed asymptotically under null hypothesis of validity of instruments as Chi-squared

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