Ownership Structure and Firm Performance: Evidence from the UK Financial Services Industry

Posted: 12 Feb 2002

See all articles by Ram Mudambi

Ram Mudambi

Temple University - Department of Strategic Management

Carmela Nicosia

University of Buckingham

Multiple version iconThere are 2 versions of this paper

Abstract

Theory tells us that managerial ownership of shares in a firm generates two conflicting effects on management behaviour, i.e. the convergence effect whereby increased managerial ownership can improve corporate performance, and the entrenchment effect which counters it. A number of studies have sought to evaluate these effects empirically. The results in the literature are not uniformly in agreement. In this paper, we distinguish between measures of ownership and measures of control implied by this ownership. Furthermore, we provide evidence supporting the entrenchment and convergence effects using UK data.

Keywords: Corporate finance, ownership structure, control, performance

JEL Classification: G32, G21, G20

Suggested Citation

Mudambi, Ram and Nicosia, Carmela, Ownership Structure and Firm Performance: Evidence from the UK Financial Services Industry. Available at SSRN: https://ssrn.com/abstract=297938

Ram Mudambi (Contact Author)

Temple University - Department of Strategic Management ( email )

Fox School of Business and Management
Philadelphia, PA 19122
United States
215-204-2099 (Phone)
215-204-8029 (Fax)

HOME PAGE: http://sbm.temple.edu/~rmudambi/index.html

Carmela Nicosia

University of Buckingham

Hunter Street
Department of Economics
Buckingham MK18 1EG
United Kingdom
44-1280-820120 (Phone)
44-1280-822245 (Fax)

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