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Product market competition, corporate governance and firm performance: an empirical analysis for Germany

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  • Januszewski, Silke I.
  • Koke, Jens
  • Winter, Joachim K.

Abstract

This study examines the impact of product market competition and corporate governance on productivity growth in German manufacturing. Using a panel of almost 500 firms over the years 1986 to 1994, we find that firms experience higher productivity growth when operating in markets with intense competition. Similarly, productivity growth is higher for firms under control of a strong ultimate owner, but not when the ultimate owner is a financial institution (a group that consisted almost exclusively of German banks and insurance firms in our sample period). Our results also indicate that competition and tight control are complements: The positive effect of competition is enhanced by the presence of a strong ultimate owner.

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Bibliographic Info

Article provided by Elsevier in its journal Research in Economics.

Volume (Year): 56 (2002)
Issue (Month): 3 (September)
Pages: 299-332

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Handle: RePEc:eee:reecon:v:56:y:2002:i:3:p:299-332

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Web page: http://www.elsevier.com/locate/inca/622941

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Citations

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Cited by:
  1. Axel H. Boersch-Supan & Joachim K. Winter, 2001. "Population Aging, Savings Behavior and Capital Markets," NBER Working Papers 8561, National Bureau of Economic Research, Inc.
  2. Elisabeth Mueller & Alexandra Spitz-Oener, 2006. "Managerial Ownership and Company Performance in German Small and Medium-Sized Private Enterprises," German Economic Review, Verein für Socialpolitik, vol. 7, pages 233-247, 05.
  3. Manoranjan Pattanayak Author- Workplace-Name: CRISIL LIMITED & Manoj Pant, . "Corporate Governance, Competition and Firm Performance: Evidence from India," Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers 10-07, Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India.
  4. Goergen, Marc & Manjon, Miguel C. & Renneboog, Luc, 2008. "Recent developments in German corporate governance," International Review of Law and Economics, Elsevier, vol. 28(3), pages 175-193, September.
  5. Jean-Claude Cosset & Hyacinthe Y. Somé & Pascale Valery, 2012. "Does Competition Matter for Corporate Governance? The Role of Country Characteristics," Cahiers de recherche 1238, CIRPEE.
  6. Marc Goergen & Miguel Manjon & Luc Renneboog, 2008. "Is the German system of corporate governance converging towards the Anglo-American model?," Journal of Management and Governance, Springer, vol. 12(1), pages 37-71, March.
  7. Ahmed Ennasri & Marc Willinger, 2011. "Managerial incentives under competitive pressure: Experimental investigation," Working Papers 11-12, LAMETA, Universtiy of Montpellier, revised Jun 2011.
  8. Sumon Kumar Bhaumik & Ralitza Dimova, 2003. "How Important is Ownership in a Market with Level Playing Field? The Indian Banking Sector Revisited," William Davidson Institute Working Papers Series 2003-569, William Davidson Institute at the University of Michigan.
  9. Wu, Hsueh-Liang, 2011. "Can minority state ownership influence firm value? Universal and contingency views of its governance effects," Journal of Business Research, Elsevier, vol. 64(8), pages 839-845, August.
  10. Mitsuru Mizuno, 2010. "Institutional Investors, Corporate Governance And Firm Performance In Japan," Pacific Economic Review, Wiley Blackwell, vol. 15(5), pages 653-665, December.
  11. Stefan Beiner & Markus Schmid & Gabrielle Wanzenried, 2004. "Product Market Competition, Managerial Inventives, and Firm Valuation," Diskussionsschriften dp0412, Universitaet Bern, Departement Volkswirtschaft.
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  13. Mueller, Elisabeth & Spitz, Alexandra, 2001. "Managerial ownership and firm performance in German small and medium-sized enterprises," ZEW Discussion Papers 01-72, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  14. Koeke, J. & Renneboog, L.D.R., 2002. "Does Good Corporate Governance Lead to Stronger Productivity Growth?," Discussion Paper 2002-89, Tilburg University, Center for Economic Research.
  15. Ahmed Ennasri, 2010. "Incitations Managériales et Concurrence : Synthèse de la Littérature," Studies and Syntheses 10-03, LAMETA, Universtiy of Montpellier, revised Oct 2010.
  16. Becher, David A. & Frye, Melissa B., 2011. "Does regulation substitute or complement governance?," Journal of Banking & Finance, Elsevier, vol. 35(3), pages 736-751, March.

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