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Large Shareholders and Banks: Who Monitors and How?

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Author Info
Yishay Yafeh (The Hebrew University of Jerusalem and The University of Montreal)
Oved Yosha (Tel Aviv University and CEPR)
Abstract

Using a sample of Japanese firms in the chemical industry, we show that concentrated shareholding is associated with lower expenditure on activities with scope for managerial private benefits. We interpret this as evidence of a hitherto undocumented form of monitoring by large shareholders. We examine whether such monitoring is also performed by banks and other creditors. The results in the metal product industry are roughly similar, but we find no evidence of this type of monitoring in the Japanese electronics industry, and suggest a number of explanations. Copyright Royal Economic Society 2003.

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Article provided by Royal Economic Society in its journal The Economic Journal.

Volume (Year): 113 (2003)
Issue (Month): 484 (January)
Pages: 128-146
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Handle: RePEc:ecj:econjl:v:113:y:2003:i:484:p:128-146

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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Joel Horowitz & Sokbae 'Simon' Lee, 2004. "Nonparametric estimation of an additive quantile regression model," CeMMAP working papers CWP07/04, Centre for Microdata Methods and Practice, Institute for Fiscal Studies. [Downloadable!]
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  2. Emilio Barucci & Fabrizio Mattesini, 2008. "Bank shareholding and lending: complementarity or substitution? Some evidence from a panel of large Italian firms!," CEIS Research Paper 118, Tor Vergata University, CEIS, revised 14 Jul 2008. [Downloadable!]
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  3. Nachane, D M & Ghosh, Saibal & Ray, Partha, 2005. "Bank nominee directors and corporate performance: micro evidence for India," MPRA Paper 1714, University Library of Munich, Germany. [Downloadable!]
    Other versions:
  4. Pascual Berrone & Jordi Surroca & Josep A. Tribó, 2005. "The Influence of Blockholders on R&D Investments Intensity: Evidence From Spain," Business Economics Working Papers wb054611, Universidad Carlos III, Departamento de Economía de la Empresa. [Downloadable!]
  5. Jochen Moebert & Patrick Tydecks, 2007. "Power and Ownership Structures among German Companies A Network Analysis of Financial Linkages," Darmstadt Discussion Papers in Economics 179, Institut für Volkswirtschaftslehre (Department of Economics), Technische Universität Darmstadt (Darmstadt University of Technology). [Downloadable!]
  6. Jean McGuire & Sandra Dow, 2009. "Japanese keiretsu: Past, present, future," Asia Pacific Journal of Management, Springer, vol. 26(2), pages 333-351, June. [Downloadable!] (restricted)
  7. Chi, Wei & Wang, Yijiang, 2007. "Ownership, Performance and Executive Turnover," MPRA Paper 3545, University Library of Munich, Germany. [Downloadable!]
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  8. Yishay Yafeh, 2003. "An International Perspective of Corporate Groups and Their Prospects," NBER Chapters, in: Structural Impediments to Growth in Japan, pages 259-284 National Bureau of Economic Research, Inc. [Downloadable!]
  9. Stéphane Lhuillery, 2006. "The impact of corporate governance practices on R&D efforts: a look at shareholders’ rights, cross-listing and control pyramid," CEMI Working Papers cemi-report-2006-006, Ecole Polytechnique Fédérale de Lausanne, Collège du Management de la Technologie, Management of Technology and Entrepreneurship Institute, Chaire en Economie et Management de l'Innovation, revised Apr 2009. [Downloadable!]
  10. Erik Dietzenbacher & Umed Temurshoev, 2008. "Ownership relations in the presence of cross-shareholding," Journal of Economics, Springer, vol. 95(3), pages 189-212, December. [Downloadable!] (restricted)
  11. Hanazaki, Masaharu & Souma, Toshiyuki & Wiwattanakantang, Yupana, 2004. "Silent Large Shareholders and Entrenched Bank Management: Evidence from the Banking Crisis in Japan," CEI Working Paper Series 2004-1, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University. [Downloadable!]
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