The Persistent Ownership Structure of Private Firms

50 Pages Posted: 5 Sep 2019 Last revised: 28 Sep 2020

See all articles by Øyvind Bøhren

Øyvind Bøhren

BI Norwegian Business School; European Corporate Governance Institute (ECGI)

Diana‐Cristina Iancu

Statistics Norway

Georgiana Radulescu

Tomra Systems ASA

R. Øystein Strøm

OsloMet - Oslo Metropolitan University

Date Written: September 14, 2020

Abstract

We find that ownership changes much less over time in private firms than in public firms. The average largest shareholder in private (public) Norwegian firms keeps the same stake in 82% (14%) of two consecutive years. In private firms past ownership dominates ownership determinants proposed in the literature, and the estimated relationship depends heavily on whether the economic model and the econometric technique capture the strong ownership persistence. This evidence suggests that lower share liquidity increases ownership duration, and that feed-back from economic outcomes to ownership structure is a less severe problem for identification when the firm's shares are illiquid.

Keywords: ownership, concentration, persistence, dynamics, duration, illiquidity, private firms, family firms, identification, system GMM, register data.

JEL Classification: G30, G32

Suggested Citation

Bøhren, Øyvind and Iancu, Diana‐Cristina and Radulescu, Georgiana and Strøm, Reidar Øystein, The Persistent Ownership Structure of Private Firms (September 14, 2020). European Corporate Governance Institute – Finance Working Paper No. 668/2020, Available at SSRN: https://ssrn.com/abstract=3448071 or http://dx.doi.org/10.2139/ssrn.3448071

Øyvind Bøhren (Contact Author)

BI Norwegian Business School ( email )

Nydalsveien 37
Oslo, 0442
Norway
46410503 (Phone)

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Diana‐Cristina Iancu

Statistics Norway ( email )

N-0033 Oslo
Norway

Georgiana Radulescu

Tomra Systems ASA ( email )

Norway

Reidar Øystein Strøm

OsloMet - Oslo Metropolitan University ( email )

P.O. Box 4
Oslo, 0130
Norway
+47 97968500 (Phone)

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