Ownership Identity and Concentration: A Study of Their Joint Impact on Corporate Diversification

Hautz, J., Mayer, M. C. J. and Stadler, C. (2013), Ownership Identity and Concentration: A Study of their Joint Impact on Corporate Diversification. British Journal of Management, 24: 102–126. doi: 10.1111/j.1467-8551.2011.00792.x

52 Pages Posted: 15 Feb 2014

See all articles by Julia Hautz

Julia Hautz

University of Innsbruck

Michael Mayer

University of Bath - School of Management

Christian Stadler

University of Warwick - Warwick Business School

Date Written: February 14, 2013

Abstract

This paper examines the impact of ownership on product and international diversification. While ownership concentration has received considerable attention from agency theorists we argue that a more nuanced analysis is necessary. We, specifically, consider how the identity of owners moderates the impact of ownership concentration on diversification strategies. We develop a framework that explains how the combination of different motivations, resources and capabilities associated with different types of owners results in significantly variable relationships between ownership concentration and both product and international diversification. From a theoretical perspective this suggests a social contextualization and extension of the agency theoretic approach that characterizes the field. Based on a study of 222 European firms between 1994 and 2007 we show that family ownership concentration has a positive impact on product and a negative impact on international diversification while the impact of institutional and state ownership concentration is negative on product diversification and positive on international diversification compared to family ownership. This is the first study to provide a comprehensive framework explaining how ownership concentration and identity interact and affect both international and product diversification.

Keywords: ownership concentration, owner identity, product diversification, international diversification

JEL Classification: M1

Suggested Citation

Hautz, Julia and Mayer, Michael and Stadler, Christian, Ownership Identity and Concentration: A Study of Their Joint Impact on Corporate Diversification (February 14, 2013). Hautz, J., Mayer, M. C. J. and Stadler, C. (2013), Ownership Identity and Concentration: A Study of their Joint Impact on Corporate Diversification. British Journal of Management, 24: 102–126. doi: 10.1111/j.1467-8551.2011.00792.x, Available at SSRN: https://ssrn.com/abstract=2395792

Julia Hautz

University of Innsbruck ( email )

Universitätsstraße 15
Innsbruck, Innsbruck 6020
Austria

Michael Mayer

University of Bath - School of Management ( email )

Claverton Down
Bath, BA2 7AY
United Kingdom

Christian Stadler (Contact Author)

University of Warwick - Warwick Business School ( email )

Coventry CV4 7AL
United Kingdom

HOME PAGE: http://www.wbs.ac.uk/about/person/christian-stadler/

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