Liquidity, Ownership Concentration, Corporate Governance, and Firm Value: Evidence from Thailand

41 Pages Posted: 15 Jun 2016

See all articles by Panu Prommin

Panu Prommin

Bank of Thailand

Seksak Jumreonwong

Thammasat University

Pornsit Jiraporn

Pennsylvania State University - School of Graduate Professional Studies (SGPS)

Shenghui Tong

Central University of Finance and Economics (CUFE)

Date Written: June 14, 2016

Abstract

We examine the interactions among ownership structure, liquidity, and corporate governance in an important emerging market. The results suggest that firms with more concentrated ownership experience significantly lower stock liquidity. Large shareholders are assumed to possess private information, leading to information asymmetry and thus a higher adverse selection cost. As a result, higher ownership concentration is associated with less liquidity. Nevertheless, there is no evidence that corporate governance plays a significant role in the relationship between ownership and liquidity in Thailand.

Keywords: ownership, ownership structure, liquidity, Thailand, emerging markets

JEL Classification: G34, G12

Suggested Citation

Prommin, Panu and Jumreonwong, Seksak and Jiraporn, Pornsit and Tong, Shenghui, Liquidity, Ownership Concentration, Corporate Governance, and Firm Value: Evidence from Thailand (June 14, 2016). Available at SSRN: https://ssrn.com/abstract=2795418 or http://dx.doi.org/10.2139/ssrn.2795418

Panu Prommin

Bank of Thailand ( email )

273 Samsen Road
Bangkhunprom, Bangkok 10200
United States

Seksak Jumreonwong

Thammasat University ( email )

Bangkok, 10200
Thailand

Pornsit Jiraporn (Contact Author)

Pennsylvania State University - School of Graduate Professional Studies (SGPS) ( email )

30 E. Swedesford Road
Malvern, PA 19355
United States
(484) 753-3655 (Phone)

HOME PAGE: http://www.personal.psu.edu/pxj11/index1.html

Shenghui Tong

Central University of Finance and Economics (CUFE) ( email )

39 South College Road
Haidian District
Beijing, Beijing 100081
China

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