Common Ownership: Europe vs. the US

33 Pages Posted: 30 Aug 2022

See all articles by Nuria Boot

Nuria Boot

German Institute for Economic Research (DIW Berlin); KU Leuven

Jo Seldeslachts

KU Leuven - Faculty of Business and Economics (FEB); German Institute for Economic Research (DIW Berlin)

Albert Banal-Estañol

Universitat Pompeu Fabra; City University London

Date Written: August 2022

Abstract

Common ownership - when an investor holds shares in two or more companies - has recently attracted significant attention from policy-makers and researchers, studying mainly US firms. European firms, however, are different as top investors with large stakes, like governments, founding families and foundations are much more prevalent. This paper takes a well-known common ownership with micro-economic foundations, lambda, capturing managerial incentives, and compares its implications for S&P Europe 350 firms to those of the S&P 500 for the period 2004-2015 by looking at within, across and global lambda patterns of the European and US S&P companies. We find that US companies have a higher lambda, but European firms’ lambda become both faster connected within Europe and across with their US counterpart where the latter is even more pronounced. Both patterns can be traced back to US investment managers’ increasing global reach.

Keywords: Ownership structure, S&P 500, S&P 350

JEL Classification: G23 ,G32, K15

Suggested Citation

Boot, Nuria and Boot, Nuria and Seldeslachts, Jo and Banal-Estañol, Albert, Common Ownership: Europe vs. the US (August 2022). DIW Berlin Discussion Paper No. 2015, 2022, Available at SSRN: https://ssrn.com/abstract=4203714 or http://dx.doi.org/10.2139/ssrn.4203714

Nuria Boot

KU Leuven ( email )

Oude Markt 13
Leuven, Vlaams-Brabant 3000
Belgium

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

Jo Seldeslachts (Contact Author)

KU Leuven - Faculty of Business and Economics (FEB) ( email )

Naamsestraat 69
Leuven, B-3000
Belgium

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

Albert Banal-Estañol

Universitat Pompeu Fabra

City University London

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
258
Abstract Views
895
Rank
222,046
PlumX Metrics