Does Ownership Structure Influence Firm Value? Evidence from India
AbstractThis paper examines the effect of ownership structure on the firm performance for an unbalanced panel of 2478 Indian corporate firms from 1994 to 2000. We examine the effect of interactions between corporate, foreign, institutional, and managerial ownership on firm performance. Using panel data framework, we show that a large fraction of cross- sectional variation, in firm performance can be explained by unobserved firm heterogeneity. We provide evidence that the shareholding by institutional investors and managers affect firm performance non- linearly, after controlling for observed firm characteristics and unobserved firm heterogeneity. We also find that the equity ownership by foreign and corporate shareholders do not influence firm performance. We find no evidence in favor of endogeneity of ownership structure.
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Bibliographic InfoPaper provided by EconWPA in its series Finance with number 0406008.
Length: 48 pages
Date of creation: 20 Jun 2004
Date of revision:
Note: Type of Document - pdf; pages: 48
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Corporate Governance; Ownership Structure; Firm performance; Panel Data; India.;
Find related papers by 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
This paper has been announced in the following NEP Reports:
- NEP-ACC-2004-06-22 (Accounting & Auditing)
- NEP-ALL-2004-06-22 (All new papers)
- NEP-CFN-2004-06-22 (Corporate Finance)
- NEP-CWA-2004-06-22 (Central & Western Asia)
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