IDEAS home Printed from https://ideas.repec.org/p/wdi/papers/1999-227.html
   My bibliography  Save this paper

Ownership Concentration and Corporate Performance in the Czech Republic

Author

Listed:
  • Stijn Claessens
  • Simeon Djankov

Abstract

The relationship between ownership structure and corporate performance has been the subject of intense research in both transition and market economies. The Czech Republic's mass-privatization program provides an unique opportunity to investigate this relationship. It changed the ownership of firms in a short period of time, and firm characteristics had only a limited influence on the resulting ownership structure. For a cross-section of 706 Czech firms over the period 1992 through 1997, we find that the more concentrated ownership, the higher firm profitability and labor productivity. These findings are weakly robust to the inclusion of control variables for the type of ownership, or to a correction for the endogeneity of ownership concentration.

Suggested Citation

  • Stijn Claessens & Simeon Djankov, 1999. "Ownership Concentration and Corporate Performance in the Czech Republic," William Davidson Institute Working Papers Series 227, William Davidson Institute at the University of Michigan.
    • Handle: RePEc:wdi:papers:1999-227
    as

    Download full text from publisher

    File URL: http://deepblue.lib.umich.edu/bitstream/2027.42/39613/3/wp227.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. J.S. Earle & S. Estrin, 1996. "Privatization Versus Competition: Changing Enterprise Behavior in Russia," Working Papers wp96049, International Institute for Applied Systems Analysis.
    2. Shleifer, Andrei & Vishny, Robert W, 1997. "A Survey of Corporate Governance," Journal of Finance, American Finance Association, vol. 52(2), pages 737-783, June.
    3. Anton Marcinèin & Sweder van Wijnbergen, 1997. "The impact of Czech privatization methods on enterprise performance incorporating initial selection‐bias correction1," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 5(2), pages 289-304, November.
    4. Shleifer, Andrei & Vishny, Robert W, 1986. "Large Shareholders and Corporate Control," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 461-488, June.
    5. Luigi Zingales, 1995. "What Determines the Value of Corporate Votes?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(4), pages 1047-1073.
    6. Andrew Weiss & Georgiy Nikitin, 1998. "Performance of Czech Companies by Ownership Structure," William Davidson Institute Working Papers Series 186, William Davidson Institute at the University of Michigan.
    7. Megginson, William L & Nash, Robert C & van Randenborgh, Matthias, 1994. "The Financial and Operating Performance of Newly Privatized Firms: An International Empirical Analysis," Journal of Finance, American Finance Association, vol. 49(2), pages 403-452, June.
    8. McConnell, John J. & Servaes, Henri, 1990. "Additional evidence on equity ownership and corporate value," Journal of Financial Economics, Elsevier, vol. 27(2), pages 595-612, October.
    9. Demsetz, Harold & Lehn, Kenneth, 1985. "The Structure of Corporate Ownership: Causes and Consequences," Journal of Political Economy, University of Chicago Press, vol. 93(6), pages 1155-1177, December.
    10. Barberis, Nicholas & Maxim Boycko & Andrei Shleifer & Natalia Tsukanova, 1996. "How Does Privatization Work? Evidence from the Russian Shops," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 764-790, August.
    11. Cable, John R, 1985. "Capital Market Information and Industrial Performance: The Role of West German Banks," Economic Journal, Royal Economic Society, vol. 95(377), pages 118-132, March.
    12. Hingorani, Archana & Lehn, Kenneth & Makhija, Anil K., 1997. "Investor behavior in mass privatization: The case of the Czech voucher scheme," Journal of Financial Economics, Elsevier, vol. 44(3), pages 349-396, June.
    13. Claessens, Stijn, 1997. "Corporate Governance and Equity Prices: Evidence from the Czech and Slovak Republics," Journal of Finance, American Finance Association, vol. 52(4), pages 1641-1658, September.
    14. A. Marcincin & S. van Wijnbergen, 1997. "The Impact of Czech Privatisation Methods on Enterprise Performance Incorporating Initial Selection Bias Correction," CERT Discussion Papers 9704, Centre for Economic Reform and Transformation, Heriot Watt University.
    15. Xiaonian Xu & Yan Wang, 1997. "Ownership structure, corporate governance, and corporate performance : the case of Chinese stock companies," Policy Research Working Paper Series 1794, The World Bank.
    16. Blanchard, O. & Aghion, P., 1996. "On insider privatization," European Economic Review, Elsevier, vol. 40(3-5), pages 759-766, April.
    17. Prowse, Stephen D, 1992. "The Structure of Corporate Ownership in Japan," Journal of Finance, American Finance Association, vol. 47(3), pages 1121-1140, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Simeon Djankov & Stijn Claessens, 1997. "Enterprise Performance and Managers' Profiles," William Davidson Institute Working Papers Series 115, William Davidson Institute at the University of Michigan.
    2. Minetti, Raoul & Murro, Pierluigi & Paiella, Monica, 2015. "Ownership structure, governance, and innovation," European Economic Review, Elsevier, vol. 80(C), pages 165-193.
    3. Mr. Alexander Pivovarsky, 2001. "How Does Privatization Work? Ownership Concentration and Enterprise Performance in Ukraine," IMF Working Papers 2001/042, International Monetary Fund.
    4. Stijn Claesens & Simeon Djankov & Gerhard Pohl, 1997. "Ownership and Corporate Governance : Evidence from the Czech Republic," World Bank Publications - Reports 11584, The World Bank Group.
    5. Barbara Blaszczyk & Iraj Hashi & Alexander Radygin & Richard Woodward, 2003. "Corporate Governance and Ownership Structure in the Transition: The Current State of Knowledge and Where to Go from Here," CASE Network Studies and Analyses 0264, CASE-Center for Social and Economic Research.
    6. Wali Ullah, 2017. "Evolving corporate governance and firms performance: evidence from Japanese firms," Economics of Governance, Springer, vol. 18(1), pages 1-33, February.
    7. John S. Earle, 1999. "Post-Privatisation Ownership Structure and Productivity in Russian Industrial Enterprises," Working Papers 1999.19, Fondazione Eni Enrico Mattei.
    8. Harper, Joel T., 2002. "The performance of privatized firms in the Czech Republic," Journal of Banking & Finance, Elsevier, vol. 26(4), pages 621-649, April.
    9. Zhong Qin & Vinod Mishra & Russell Smyth, 2016. "An empirical examination of endogenous ownership in Chinese private enterprises," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 21(4), pages 513-530, October.
    10. Konstantin Gluschenko, 2004. "Analysing changes in market integration through a cross-sectional test for the law of one price," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 9(2), pages 135-149.
    11. Kouznetsov Pavel & Muravyev Alexander, 2001. "Ownership Structure and Firm Performance in Russia: The Case of Blue Chips of the Stock Market," EERC Working Paper Series 01-10e, EERC Research Network, Russia and CIS.
    12. Yasser, Qaiser Rafique & Mamun, Abdullah Al, 2014. "Implications of Ownership Identity and Insider's Supermacy on the Economic Performance of the Liste Companies," MPRA Paper 61426, University Library of Munich, Germany.
    13. Timofeev Andrey, 2002. "Fiscal Decentralization and Soft Budget Constraints," EERC Working Paper Series 01-12e, EERC Research Network, Russia and CIS.
    14. Cabeza-García, Laura & Gómez-Ansón, Silvia, 2011. "Post-privatisation ownership concentration: Determinants and influence on firm efficiency," Journal of Comparative Economics, Elsevier, vol. 39(3), pages 412-430, September.
    15. Alexander Radygin & Revold Entov & Marina Turuntseva & Alena Gontmakher & Harry Swain & Jeff Carruthers & Karen Minden & Cheryl Urban, 2002. "The problems of corporate governance in Russia and its regions," Published Papers 12, Gaidar Institute for Economic Policy, revised 2002.
    16. Bruce Burton & Abeyratna Gunasekarage & Jayanthi Kumarasiri, 2013. "The influence of blockownership level and identity on board composition: evidence from the New Zealand market," Applied Financial Economics, Taylor & Francis Journals, vol. 23(16), pages 1287-1299, August.
    17. 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.
    18. Nam Hoai Tran & Chi Dat Le & David McMillan, 2020. "Ownership concentration, corporate risk-taking and performance: Evidence from Vietnamese listed firms," Cogent Economics & Finance, Taylor & Francis Journals, vol. 8(1), pages 1732640-173, January.
    19. Attiya Y. Javid & Robina Iqbal, 2010. "Corporate Governance in Pakistan : Corporate Valuation, Ownership and Financing," Governance Working Papers 22830, East Asian Bureau of Economic Research.
    20. Hingorani, Archana & Lehn, Kenneth & Makhija, Anil K., 1997. "Investor behavior in mass privatization: The case of the Czech voucher scheme," Journal of Financial Economics, Elsevier, vol. 44(3), pages 349-396, June.

    More about this item

    JEL classification:

    • 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

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wdi:papers:1999-227. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: WDI (email available below). General contact details of provider: https://edirc.repec.org/data/wdumius.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.