Corporate Performance and Ownership Structure: Empirical Evidence for Chile

Quarterly Journal of Finance and Accounting, Vol. 50, No. 1,2011

Posted: 3 Nov 2013

See all articles by Carlos P. Maquieira

Carlos P. Maquieira

Independent

Christian Espinosa

Universidad Diego Portales

João Paulo Vieito

Scholl of Business Studies - Polytechnic Instituto of Viana do Castelo

Date Written: November 1, 2011

Abstract

This article focuses on the relationship between performance and corporate diversification. The sample covers 70 Chilean public firms between 2000 and 2007. Our findings show a positive and statistically significant relation between performance and corporate diversification. Moreover, when separating the sample into two groups, namely, those that are less and those that are more diversified, a positive relationship between ownership concentration and performance is observed in the case of less diversified firms. On the other hand, for the more diversified group, we report a negative relationship between ownership concentration and performance for the main and the three largest shareholders. Another interesting result is the negative relationship between amount of fixed assets and performance. Finally, we are not aware of other studies that control for country risk premium, which we find to be a relevant variable since the higher the country risk premium the lower the corporate performance is. This may suggest that the marginal investor in Chile is not able to fully diversify country risk.

Keywords: Diversification, Ownership Structure, Panel Data

JEL Classification: C30, C33, G15

Suggested Citation

Maquieira, Carlos P. and Espinosa, Christian and Vieito, João Paulo, Corporate Performance and Ownership Structure: Empirical Evidence for Chile (November 1, 2011). Quarterly Journal of Finance and Accounting, Vol. 50, No. 1,2011 , Available at SSRN: https://ssrn.com/abstract=2348838

Carlos P. Maquieira

Independent ( email )

Christian Espinosa

Universidad Diego Portales ( email )

Vergara 210
Santiago, Santiag
Chile

João Paulo Vieito (Contact Author)

Scholl of Business Studies - Polytechnic Instituto of Viana do Castelo ( email )

Avenida Miguel Dantas
Valença, 4930
Portugal

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