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Interlocking directorates in Italy: persistent links in network dynamics

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  • Lucia Bellenzier
  • Rosanna Grassi

Abstract

In this work we study the time evolution of interlocking directorates in Italy from 1998 to 2011 by means of dynamical networks. Our purpose is to assess if in Italy there is a connected and stable structure, due to the presence of directors with multiple mandates, like it happens in the German case. We find a very cohesive network structure, due to the presence of a few directors with multiple assignments and, unlike the German case, this structure is stable, but not connected. Moreover we propose an alternative approach to investigate the dynamics, based on temporal networks, in order to quantify the variation of links in a certain time period. We construct a unique cumulative network, where nodes are companies and the existence of an edge is related with the persistence in time of an interlock between two companies. This persistence is due on the one hand to the ownership of a few family firms, and on the other hand to cross-shareholdings between companies. To complete the analysis we also investigate whether the link stability results from the appointments of the same director or from the stepping in/out of different directors. Copyright Springer-Verlag Berlin Heidelberg 2014

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  • Lucia Bellenzier & Rosanna Grassi, 2014. "Interlocking directorates in Italy: persistent links in network dynamics," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 9(2), pages 183-202, October.
    • Handle: RePEc:spr:jeicoo:v:9:y:2014:i:2:p:183-202
    DOI: 10.1007/s11403-013-0119-8
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    Cited by:

    1. Matthias Raddant & Hiroshi Takahashi, 2022. "Corporate boards, interorganizational ties and profitability: the case of Japan," Empirical Economics, Springer, vol. 62(3), pages 1365-1406, March.
    2. Lucrezia Fattobene & Marco Caiffa & Emiliano Di Carlo, 2018. "Interlocking directorship across Italian listed companies: evidence from a natural experiment," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 22(2), pages 393-425, June.
    3. Drago, Carlo, 2015. "Exploring the Community Structure of Complex Networks," MPRA Paper 81024, University Library of Munich, Germany.
    4. Roy Cerqueti & Giulia Rotundo & Marcel Ausloos, 2021. "Tsallis entropy for cross-shareholding network configurations," Papers 2109.04214, arXiv.org.
    5. Gualdani, Cristina, 2018. "An Econometric Model of Network Formation with an Application to Board Interlocks between Firms," TSE Working Papers 17-898, Toulouse School of Economics (TSE), revised Jul 2019.
    6. Bargigli, L. & Giannetti, R., 2018. "The Italian corporate system in a network perspective (1952–1983)," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 494(C), pages 367-379.
    7. An Zeng & Stefano Battiston, 2016. "The Multiplex Network of EU Lobby Organizations," PLOS ONE, Public Library of Science, vol. 11(10), pages 1-15, October.
    8. Gualdani, Cristina, 2021. "An econometric model of network formation with an application to board interlocks between firms," Journal of Econometrics, Elsevier, vol. 224(2), pages 345-370.
    9. Leonardo Bargigli & Renato Giannetti, 2015. "The Italian Corporate System: SOEs, Private Firms and Institutions in a Network Perspective (1952-1983)," Working Papers - Economics wp2015_01.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
    10. Gian Paolo Clemente & Marco Fattore & Rosanna Grassi, 2018. "Structural comparisons of networks and model-based detection of small-worldness," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 13(1), pages 117-141, April.
    11. Drago, Carlo, 2015. "Exploring the Community Structure of Complex Networks," MPRA Paper 81024, University Library of Munich, Germany.
    12. Roy Cerqueti & Giulia Rotundo & Marcel Ausloos, 2018. "Investigating the configurations in cross-shareholding: a joint copula-entropy approach," Papers 1807.09346, arXiv.org.
    13. Sankowska, Anna & Siudak, Dariusz, 2016. "The small world phenomenon and assortative mixing in Polish corporate board and director networks," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 443(C), pages 309-315.
    14. Drago, Carlo & Ricciuti, Roberto, 2017. "Communities detection as a tool to assess a reform of the Italian interlocking directorship network," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 466(C), pages 91-104.
    15. Andrea Fracasso & Valentina Peruzzi & Chiara Tomasi, 2019. "Multiple banking relationships: the role of firm connectedness," DEM Working Papers 2019/3, Department of Economics and Management.
    16. Cristina Gualdani, 2021. "An Econometric Model of Network Formation with an Application to Board Interlocks between Firms," Post-Print hal-03548907, HAL.
    17. Battaggion, Maria Rosa & Cerasi, Vittoria, 2020. "Strategic interlocking directorates," Journal of Economic Behavior & Organization, Elsevier, vol. 178(C), pages 85-101.
    18. Carlo Drago & Roberto Ricciuti, 2019. "Bootstrapping the Gini Index of the Network Degree: An Application for Italian Corporate Governance," Working Papers 05/2019, University of Verona, Department of Economics.
    19. Raddant, Matthias & Takahashi, Hiroshi, 2019. "The Japanese corporate board network," Kiel Working Papers 2130, Kiel Institute for the World Economy (IfW Kiel).
    20. Maria Rosa Battaggion & Vittoria Cerasi, 2018. "Endogenous interlocking directorates," Working Papers 380, University of Milano-Bicocca, Department of Economics, revised 01 May 2018.
    21. Ricardo Giglio & Thomas Lux, 2021. "The Core of the Global Corporate Network," Networks and Spatial Economics, Springer, vol. 21(3), pages 681-705, September.
    22. Matthias Raddant & Mishael Milaković & Laura Birg, 2017. "Persistence in corporate networks," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 12(2), pages 249-276, July.
    23. Su Kun & Liu Heng, 2019. "The Effect of Interlocking Director Network on Corporate Risk Taking: Lessons from China," Entrepreneurship Research Journal, De Gruyter, vol. 9(1), pages 1-21, January.

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    More about this item

    Keywords

    Interlocking directorates; Temporal networks; Corporate governance; C02; D85; G30;
    All these keywords.

    JEL classification:

    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

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