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Ownership Structure and Firm Performance in Russia: The Case of Blue Chips of the Stock Market

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  • Kuznetsov, Pavel
  • Muravyev, Alexander

Abstract

Based on panel data from 1995 – 1997, the paper focuses on the impact of ownership structure on the performance of Russian non-financial privatized companies that constitute the group of "blue chips" of the country's stock market. We find that ownership concentration results in higher technical efficiency of enterprises, but benefits from productivity improvements do not adequately materialize in higher profitability and market value of companies. This is consistent with the expropriation hypothesis that large owners use their power to extract private benefits of control. We also find that the association between ownership by different groups of owners and firm performance is relatively weak and subject to reversed causality. There is evidence that ownership by Russian non-state shareholders negatively affects firm value suggesting that this group of owners is inclined to the extraction of private benefits of control.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 27231.

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Date of creation: 2001
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Handle: RePEc:pra:mprapa:27231

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Keywords: Russia; corporate governance; ownership structure.;

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References

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  1. Erik BERGLÖF & Ernst-Ludwig VON THADDEN, 1999. "The Changing Corporate Governance Paradigm : Implications for Transition and Developing Countries," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 9912, Université de Lausanne, Faculté des HEC, DEEP.
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Citations

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Cited by:
  1. Ichiro Iwasaki, 2007. "Enterprise Reform And Corporate Governance In Russia: A Quantitative Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 21(5), pages 849-902, December.
  2. Salla Pöyry & Benjamin Maury, 2010. "Influential ownership and capital structure," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 31(5), pages 311-324.
  3. Vitaliy Zheka, 2006. "Corporate Governance and Firm Performance in Ukraine," CERT Discussion Papers 0605, Centre for Economic Reform and Transformation, Heriot Watt University.
  4. Muravyev, Alexander & Bilyk, Olga & Grechaniuk, Bogdana, 2009. "Firm Performance and Managerial Turnover: The Case of Ukraine," MPRA Paper 13685, University Library of Munich, Germany.
  5. Muravyev, Alexander, 2003. "Государственные Пакеты Акций В Российских Компаниях: Происхождение, Типы И Влияние На Результаты Деятельнос," MPRA Paper 27393, University Library of Munich, Germany.
  6. Attiya Y. Javid & Robina Iqbal, 2010. "Corporate Governance in Pakistan: Corporate Valuation, Ownership and Financing," PIDE-Working Papers 2010:57, Pakistan Institute of Development Economics.
  7. Sprenger, Carsten, 2011. "The choice of ownership structure: Evidence from Russian mass privatization," Journal of Comparative Economics, Elsevier, vol. 39(2), pages 260-277, June.
  8. Berezinets, Irina & Ilina, Yulia & Muravyev, Alexander, 2011. "CEO and Board Characteristics as Determinants of Private Benefits of Control: Evidence from the Russian Stock Exchange," IZA Discussion Papers 6256, Institute for the Study of Labor (IZA).

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