Synchronicity and firm interlocks in an emerging market
Stock price synchronicity has been attributed to poor corporate governance and a lack of firm-level transparency. This paper investigates the association between different kinds of firm interlocks, control groups, and synchronicity in Chile. A unique data set containing equity cross-holdings, common individual owners, and director interlocks is used to map out firm ties and control groups. While there is a correlation between synchronicity and share ownership and equity ties, synchronicity is more strongly correlated with interlocking directorates. The presence of share directors is associated with either reduced firm-level transparency or increased correlation in firm fundamentals--due, for example, to joint resource allocation across the firms.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Marianne Bertrand & Paras Mehta & Sendhil Mullainathan, 2000.
"Ferreting Out Tunneling: An Application to Indian Business Groups,"
NBER Working Papers
7952, National Bureau of Economic Research, Inc.
- Marianne Bertrand & Paras Mehta & Sendhil Mullainathan, 2002. "Ferreting out Tunneling: An Application to Indian Business Groups," The Quarterly Journal of Economics, Oxford University Press, vol. 117(1), pages 121-148.
- Lingfeng Li, 2003. "Macroeconomic Factors and the Correlation of Stock and Bond Returns," Yale School of Management Working Papers ysm324, Yale School of Management.
- Rafael La Porta & Florencio Lopez-deSilanes & Andrei Shleifer & Robert W. Vishny, 1999.
"Investor Protection and Corporate Valuation,"
NBER Working Papers
7403, National Bureau of Economic Research, Inc.
- Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert Vishny, 1999. "Investor Protection and Corporate Valuation," Harvard Institute of Economic Research Working Papers 1882, Harvard - Institute of Economic Research.
- Tarun Khanna & Yishay Yafeh, 2007. "Business Groups in Emerging Markets: Paragons or Parasites?," Journal of Economic Literature, American Economic Association, vol. 45(2), pages 331-372, June.
- Lingfeng Li, 2003. "Macroeconomic Factors and the Correlation of Stock and Bond Returns," Yale School of Management Working Papers ysm328, Yale School of Management.
- Chan, K Hung & Hayya, Jack C & Ord, J Keith, 1977. "A Note on Trend Removal Methods: The Case of Polynomial Regression versus Variate Differencing," Econometrica, Econometric Society, vol. 45(3), pages 737-44, April.
- Murphy, Kevin M. & Shleifer, Andrei & Vishny, Robert W., 1989.
"Industrialization and the Big Push,"
3606235, Harvard University Department of Economics.
- Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 1998.
"Corporate Ownership Around the World,"
Harvard Institute of Economic Research Working Papers
1840, Harvard - Institute of Economic Research.
- Raghuram G. Rajan & Luigi Zingales, 1998.
"Which Capitalism? Lessons from the East Asian Crisis,"
CRSP working papers
486, Center for Research in Security Prices, Graduate School of Business, University of Chicago.
- Raghuram G. Rajan & Luigi Zingales, 1998. "Which Capitalism? Lessons Form The East Asian Crisis," Journal of Applied Corporate Finance, Morgan Stanley, vol. 11(3), pages 40-48.
- Leff, Nathaniel H, 1978. "Industrial Organization and Entrepreneurship in the Developing Countries: The Economic Groups," Economic Development and Cultural Change, University of Chicago Press, vol. 26(4), pages 661-75, July.
- Fedenia, Mark & Hodder, James E & Triantis, Alexander J, 1994. "Cross-Holdings: Estimation Issues, Biases, and Distortions," Review of Financial Studies, Society for Financial Studies, vol. 7(1), pages 61-96.
- Tarun Khanna & Krishna Palepu, 2000. "Is Group Affiliation Profitable in Emerging Markets? An Analysis of Diversified Indian Business Groups," Journal of Finance, American Finance Association, vol. 55(2), pages 867-891, 04.
- Jin, Li & Myers, Stewart C., 2006. "R2 around the world: New theory and new tests," Journal of Financial Economics, Elsevier, vol. 79(2), pages 257-292, February.
- Randall Morck & Masao Nakamura, 2007. "Business Groups and the Big Push: Meiji Japan's Mass Privatization and Subsequent Growth," NBER Working Papers 13171, National Bureau of Economic Research, Inc.
- Morck, Randall & Nakamura, Masao, 2007. "Business Groups and the Big Push: Meiji Japan's Mass Privatization and Subsequent Growth," Enterprise & Society, Cambridge University Press, vol. 8(03), pages 543-601, September.
When requesting a correction, please mention this item's handle: RePEc:eee:jfinec:v:92:y:2009:i:2:p:182-204. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.