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The effect of agency costs on the value of single-segment and multi-segment firms

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  • Nam, Jouahn
  • Tang, Charles
  • Thornton, John Jr.
  • Wynne, Kevin

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  • Nam, Jouahn & Tang, Charles & Thornton, John Jr. & Wynne, Kevin, 2006. "The effect of agency costs on the value of single-segment and multi-segment firms," Journal of Corporate Finance, Elsevier, vol. 12(4), pages 761-782, September.
  • Handle: RePEc:eee:corfin:v:12:y:2006:i:4:p:761-782
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    References listed on IDEAS

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    1. Lang, Larry H P & Stulz, Rene M, 1994. "Tobin's q, Corporate Diversification, and Firm Performance," Journal of Political Economy, University of Chicago Press, vol. 102(6), pages 1248-1280, December.
    2. Bebchuk, Lucian Arye & Fried, Jesse & Walker, David I, 2002. "Managerial Power and Rent Extraction in the Design of Executive Compensation," CEPR Discussion Papers 3558, C.E.P.R. Discussion Papers.
    3. Yakov Amihud & Baruch Lev, 1981. "Risk Reduction as a Managerial Motive for Conglomerate Mergers," Bell Journal of Economics, The RAND Corporation, vol. 12(2), pages 605-617, Autumn.
    4. Lang, Larry & Poulsen, Annette & Stulz, Rene, 1995. "Asset sales, firm performance, and the agency costs of managerial discretion," Journal of Financial Economics, Elsevier, vol. 37(1), pages 3-37, January.
    5. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    6. David J. Denis & Diane K. Denis & Keven Yost, 2002. "Global Diversification, Industrial Diversification, and Firm Value," Journal of Finance, American Finance Association, vol. 57(5), pages 1951-1979, October.
    7. Stulz, ReneM., 1990. "Managerial discretion and optimal financing policies," Journal of Financial Economics, Elsevier, vol. 26(1), pages 3-27, July.
    8. Mehran, Hamid, 1995. "Executive compensation structure, ownership, and firm performance," Journal of Financial Economics, Elsevier, vol. 38(2), pages 163-184, June.
    9. Sudip Datta, 2001. "Executive Compensation and Corporate Acquisition Decisions," Journal of Finance, American Finance Association, vol. 56(6), pages 2299-2336, December.
    10. Sattar A. Mansi & David M. Reeb, 2002. "Corporate Diversification: What Gets Discounted?," Journal of Finance, American Finance Association, vol. 57(5), pages 2167-2183, October.
    11. Jensen, Michael C, 1986. "Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers," American Economic Review, American Economic Association, vol. 76(2), pages 323-329, May.
    12. Servaes, Henri, 1996. " The Value of Diversification during the Conglomerate Merger Wave," Journal of Finance, American Finance Association, vol. 51(4), pages 1201-1225, September.
    13. Bebchuk, Lucian A. & Fried, Jesse M., 2003. "Executive Compensation as an Agency Problem," Berkeley Olin Program in Law & Economics, Working Paper Series qt81q3136r, Berkeley Olin Program in Law & Economics.
    14. Michael C. Jensen & Kevin J. Murphy, 2010. "CEO Incentives-It's Not How Much You Pay, But How," Journal of Applied Corporate Finance, Morgan Stanley, vol. 22(1), pages 64-76.
    15. Lucian Arye Bebchuk & Jesse M. Fried, 2003. "Executive Compensation as an Agency Problem," Journal of Economic Perspectives, American Economic Association, vol. 17(3), pages 71-92, Summer.
    16. John R. Graham & Michael L. Lemmon & Jack G. Wolf, 2002. "Does Corporate Diversification Destroy Value?," Journal of Finance, American Finance Association, vol. 57(2), pages 695-720, April.
    17. Mehran, Hamid & Nogler, George E. & Schwartz, Kenneth B., 1998. "CEO incentive plans and corporate liquidation policy," Journal of Financial Economics, Elsevier, vol. 50(3), pages 319-349, December.
    18. Karl Lins & Henri Servaes, 1999. "International Evidence on the Value of Corporate Diversification," Journal of Finance, American Finance Association, vol. 54(6), pages 2215-2239, December.
    19. Berger, Philip G. & Ofek, Eli, 1995. "Diversification's effect on firm value," Journal of Financial Economics, Elsevier, vol. 37(1), pages 39-65, January.
    20. Bhagat, Sanjai & Brickley, James A. & Lease, Ronald C., 1985. "Incentive effects of stock purchase plans," Journal of Financial Economics, Elsevier, vol. 14(2), pages 195-215, June.
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    Cited by:

    1. Vasilescu, Camelia & Millo, Yuval, 2016. "Do industrial and geographic diversifications have different effects on earnings management? Evidence from UK mergers and acquisitions," International Review of Financial Analysis, Elsevier, vol. 46(C), pages 33-45.
    2. Farooqi, Javeria & Huerta, Daniel & Ngo, Thanh, 2015. "Should you globally diversify or let the globally diversified firm do it for you?," The Quarterly Review of Economics and Finance, Elsevier, vol. 57(C), pages 75-85.
    3. Farooqi, Javeria & Harris, Oneil & Ngo, Thanh, 2014. "Corporate diversification, real activities manipulation, and firm value," Journal of Multinational Financial Management, Elsevier, vol. 27(C), pages 130-151.
    4. Lin, Chen & Su, Dongwei, 2008. "Industrial diversification, partial privatization and firm valuation: Evidence from publicly listed firms in China," Journal of Corporate Finance, Elsevier, vol. 14(4), pages 405-417, September.

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