Abstract

http://ssrn.com/abstract=2138949
 


 



Public Debate and Stock Prices: Evidence from the Voting Premium


Fabio Braggion


Tilburg University - Center and Faculty of Economics and Business Administration; Tilburg University - European Banking Center

Mariassunta Giannetti


Stockholm School of Economics; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); Swedish House of Finance

June 7, 2014

ECGI - Finance Working Paper No. 375

Abstract:     
An intense debate on the use of limited-voting shares developed in the UK between 1955 and 1970. We show that negative news coverage of limited-voting shares is associated with an increase in the relative price of voting and limited-voting shares, even if no new material information is revealed. The effects are stronger for firms that are difficult to arbitrage. Furthermore, negative news coverage is followed by lower returns for voting shares than for limited-voting shares. Our results suggest that the public debate may have limited firms’ ability to use limited-voting shares and have broader implications for corporate governance.

Number of Pages in PDF File: 45

Keywords: Corporate Governance, Dual Class Shares, Public Debate

JEL Classification: G02, G1, G3

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Date posted: September 1, 2012 ; Last revised: June 8, 2014

Suggested Citation

Braggion, Fabio and Giannetti, Mariassunta, Public Debate and Stock Prices: Evidence from the Voting Premium (June 7, 2014). ECGI - Finance Working Paper No. 375. Available at SSRN: http://ssrn.com/abstract=2138949 or http://dx.doi.org/10.2139/ssrn.2138949

Contact Information

Fabio Braggion
Tilburg University - Center and Faculty of Economics and Business Administration ( email )
P.O. Box 90153
Tilburg, 5000 LE
Netherlands
Tilburg University - European Banking Center ( email )
PO Box 90153
Tilburg, 5000 LE
Netherlands
Mariassunta Giannetti (Contact Author)
Stockholm School of Economics ( email )
P.O. Box 6501
Sveavagen 65
SE-113 83 Stockholm
Sweden
+46 8 736 9607 (Phone)
+46 8 312 327 (Fax)
HOME PAGE: http://sites.google.com/site/mariassuntagiannetti/Home
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
European Corporate Governance Institute (ECGI)
c/o ECARES ULB CP 114
B-1050 Brussels
Belgium
HOME PAGE: http://www.ecgi.org
Swedish House of Finance ( email )
Drottninggatan 98
111 60 Stockholm
Sweden

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