Ownership Structure and Corporate Performance
University of California, Los Angeles (UCLA) - Department of Economics
New York University (NYU) - Leonard N. Stern School of Business
This paper investigates the relation between the ownership structure and the performance of corporations if ownership is made multi-dimensional and also is treated as an endogenous variable. To our knowledge, no prior study has treated the corporate control problem this way. We find no statistically significant relation between ownership structure and firm performance. This finding is consistent with the view that diffuse ownership, while it may exacerbate some agency problems, also yields compensating advantages that generally offset such problems. Consequently, for data that reflect market-mediated ownership structures, no systematic relation between ownership structure and firm performance is to be expected.
The accepted paper version of this abstract can be accessed using the following URL: http://ssrn.com/abstract_id=304181
Number of Pages in PDF File: 37
Keywords: ownership, performance
JEL Classification: G32, G34working papers series
Date posted: April 11, 2001
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