Abstract

http://ssrn.com/abstract=976409
 
 

References (33)



 
 

Citations (4)



 


 



Unbundling Ownership and Control


Daniel Ferreira


London School of Economics & Political Science (LSE) - Department of Finance; European Corporate Governance Institute (ECGI); Centre for Economic Policy Research (CEPR)

Emanuel Ornelas


London School of Economics & Political Science (LSE) - Department of Management; London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP)

John L. Turner


University of Georgia - C. Herman and Mary Virginia Terry College of Business - Department of Economics

May 27, 2013

Journal of Economics & Management Strategy (Forthcoming)

Abstract:     
We study control contests under asymmetric information. Using a mechanism design approach, we fully characterize the optimal control contest mechanism. The optimal mechanism requires increasing the number of shares owned by the incumbent insider if he remains in control, while giving him a golden parachute that includes both shares and cash if he is deposed. The model underscores a novel explanation for the prevalence and persistence of the separation of ownership from control: efficiency in control contests is more easily achieved when ownership of cash flow rights is not concentrated in the hands of insiders.

Number of Pages in PDF File: 43

Keywords: Corporate control, restructuring, mechanism design

JEL Classification: G32, G34, D82

Accepted Paper Series





Download This Paper

Date posted: October 31, 2005 ; Last revised: May 28, 2013

Suggested Citation

Ferreira, Daniel and Ornelas, Emanuel and Turner, John L., Unbundling Ownership and Control (May 27, 2013). Journal of Economics & Management Strategy (Forthcoming). Available at SSRN: http://ssrn.com/abstract=976409 or http://dx.doi.org/10.2139/ssrn.976409

Contact Information

Daniel Ferreira
London School of Economics & Political Science (LSE) - Department of Finance ( email )
Houghton Street
London, WC2A 2AE
United Kingdom
(+44) 20 7955 7544 (Phone)
HOME PAGE: http://personal.lse.ac.uk/FERREIRD/
European Corporate Governance Institute (ECGI)
c/o ECARES ULB CP 114
B-1050 Brussels
Belgium
HOME PAGE: http://www.ecgi.org
Centre for Economic Policy Research (CEPR) ( email )
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Emanuel Ornelas
London School of Economics & Political Science (LSE) - Department of Management ( email )
United Kingdom
London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP) ( email )
Houghton Street
London WC2A 2AE
United Kingdom
John L. Turner (Contact Author)
University of Georgia - C. Herman and Mary Virginia Terry College of Business - Department of Economics ( email )
Athens, GA 30602-6254
United States
Feedback to SSRN


Paper statistics
Abstract Views: 3,312
Downloads: 786
Download Rank: 16,301
References:  33
Citations:  4

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo6 in 0.453 seconds