Abstract

https://ssrn.com/abstract=2612047
 


 



The Disappearance of Public Firms and the Changing Nature of U.S. Industries


Gustavo Grullon


Rice University - Jesse H. Jones Graduate School of Business

Yelena Larkin


Schulich School of Business, York University

Roni Michaely


Johnson@Cornell Tech, Cornell University

May 29, 2015


Abstract:     
There has been a systematic decline in the number of publicly-traded firms over the last two decades. Half of the U.S. industries lost over 50% of their publicly traded peers. The decline has increased industry concentration, as the void left by public firms has not been filled by an increase in the number of private businesses or by greater presence of foreign firms. Firms in industries with the largest decline in the number of firms have generated higher profit margins and abnormal stock returns, and enjoyed better investment opportunities through M&A deals. Overall, our findings suggest that the nature of US product markets has undergone a structural shift that has potentially weakened competition.

Number of Pages in PDF File: 58

Keywords: Publicly-traded firms; industry concentration; product markets

JEL Classification: G18, G30, G34, G48, L40, L10


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Date posted: May 31, 2015  

Suggested Citation

Grullon, Gustavo and Larkin, Yelena and Michaely, Roni, The Disappearance of Public Firms and the Changing Nature of U.S. Industries (May 29, 2015). Available at SSRN: https://ssrn.com/abstract=2612047 or http://dx.doi.org/10.2139/ssrn.2612047

Contact Information

Gustavo Grullon (Contact Author)
Rice University - Jesse H. Jones Graduate School of Business ( email )
P.O. Box 2932
Houston, TX 77252-2932
United States
(713) 348-6138 (Phone)
(713) 348-6331 (Fax)
HOME PAGE: http://www.ruf.rice.edu/~grullon/
Yelena Larkin
Schulich School of Business, York University ( email )
4700 Keele Street
Toronto, Ontario M3J 1P3
Canada
Roni Michaely
Johnson@Cornell Tech, Cornell University ( email )
111 8th Avenue #302
New York, NY 10011
United States
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