Ownership Structure and Firm Performance: International Evidence

摘要: The empirical results on the effect of insider shareholdings firm performance are mixed. Previous studies focus solely U.S. firms, and therefore, their implications limited. We develop more generalized insights into relation between by examining firms from seven major industrialized countries using various measures performance. Our show that, controlling for other factors, has a mixed, albeit weak, INTRODUCTION This paper examines ownership structure corporate performance, accounting ratios including market-tobook as Following Jensen Meckling [1976], interest in allocation shares among shareholders continued to evolve finance literature. According [ 1976], managers' natural tendency is allocate firm's resources own best interests, which may conflict with interests outside shareholders. As equity increases, however, coincide closely those shareholders, hence conflicts managers likely be resolved. Thus, management's helps resolve agency problems improve However, several suggest that does not always have positive Fama [1983] demonstrate possibilities who enough stock dominate board directors could expropriate wealth. A large-block shareholder could, example, pay himself an excessive salary, negotiate 'sweetheart' deals companies he controls, or invest negative-net-present-value projects. Stulz [1988] explains how owning large blocks makes it easier entrenched. greater increases power internal constituency, but decreases external constituency influencing Morck, Shleifer, Vishny [1988], McConnell Servaes [1990], others, empirically examine estimate piece-wise linear regression dependent variable Tobin's q ratio (Tobin [1969]) proxy primary independent fraction owned insiders. While these do agree detailed results, they both report relationship degree linear: some range ownership, positively related but, range, negative found. support view Using different methodology, [1990] also nonlinearly ownership. Interestingly, institutional indicating They entrenchment would difficult existence objective this reexamine seek mixed broader sample, adopting measures, applying less problematic methodologies than earlier studies. research two important aspects. First, we use international data include 2,000 G7 countries. …