Early success
From Alfred Max
By Professor Anna Göddeke and Alfred Max
It is rather rare to have the opportunity to publish a bachelor’s thesis in a peer-reviewed journal that follows the highest scientific standards. Niklas Frühling, who was enrolled in the International Business IB programme at ESB Business School before his bachelor’s degree in February, has managed to do just that.
His bachelor’s thesis ‘The effect of diversification on company value during a global health crisis: evidence from the COVID-19 pandemic’, which he wrote during the winter semester 2021/22 with Professor Dr Hans-Martin Beyer and Professor Anna Göddeke as supervisors, has been accepted by the Journal of Managerial Finance. The thesis highlights the exciting question of whether companies that are diversified fared better or worse during the Covid crisis than non-diversified companies. For this purpose, Niklas Frühling created a cross-sectional regression (an analysis to describe correlations in data) and a propensity score matching (a statistical procedure) with listed European countries and examined the change in company value during the crisis. The surprising result: the company value of diversified companies decreased during the Covid 19 pandemic – quite contrary to the results of previous literature. However, these had investigated other crises. This raises the question of whether diversification is an appropriate hedge against the negative effects of pandemics.
