Ownership Concentration, Market Monitoring and Performance: Evidence from the UK, the Czech Republic and Poland
AbstractUsing data for publicly traded companies from the UK and two transition countries, the Czech Republic and Poland, we analyze the relationship between ownership concentration and performance while also accounting for the effect of hostile takeover threats on this relationship. Some argue that ownership concentration will improve performance by making the owners more willing or able to monitor managers. Others argue that in the presence of efficient markets, market monitoring (via the threat of hostile takeovers) will discipline the managers. Our results show that concentration is insignificant in explaining performance both in the transition countries, where market monitoring is supposedly weak, and in the UK, where market monitoring is supposedly strong.
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Bibliographic InfoPaper provided by Department of Economics, Rutgers University, Newark in its series Working Papers Rutgers University, Newark with number 2005-012.
Length: 19 pages
Date of creation: Sep 2005
Date of revision:
Ownership Concentration; Markets for Corporate Control;
Other versions of this item:
- Vahe Lskavyan & Mariana Spatareanu, 2006. "Ownership concentration, market monitoring and performance: Evidence from the UK, the Czech Republic and Poland," Journal of Applied Economics, Universidad del CEMA, vol. 0, pages 91-104, May.
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-11-05 (All new papers)
- NEP-COM-2005-11-05 (Industrial Competition)
- NEP-FIN-2005-11-05 (Finance)
- NEP-TRA-2005-11-05 (Transition Economics)
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