Chinese researchers have long preferred substantive research (i.e., examination of relationships among variables) to construct
validation research, while failing to realize that construct validation research is the foundation of substantive research.
This paper endeavors to answer a question: Do Rumelt’s (1974) categorical and Standard Industrial Classification (SIC) and
skill-based continuous
... [Show full abstract] measures capture the same construct of diversity in the context of China? We take two steps to investigate
the question. First, are continuous measures (SIC & skill-based entropy and Montgomery product count) appropriately differentiated
among Rumelt’s categories? Second, are the categories converted from SIC & Skill-based measures convergent to Rumelt’s categorical
measures? Results show that the two measures are consistent with each other.
Keywordsdiversification-continuous measures-categorical measures-Standard Industrial Classification