The separation of ownership and control and investment decisions in Mexican manufacturing firms
We study how the ownership and control structures may explain investment decisions of Mexican manufacturing firms. We study them with aggregate indexes and the assessment of several regression sets. We use measures of ownership, management and agency costs. The econometric analysis uses longitudinal census data for 182 industries. Our findings support the claim that agency costs, as a measure of the separation of management and control, and firms` size can explain investment decisions. Furthermore the estimations support the necessity to include investment opportunities and cash flow as control variables. The coefficients of all variables are mostly significant and positive.
|Date of creation:||20 Sep 2010|
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- Ruiz-Porras, Antonio & Steinwascher, William, 2007.
"Gobierno corporativo, diversificación estratégica y desempeño empresarial en México
[Corporate governance, strategic diversification and performance of firms in Mexico]," MPRA Paper 3819, University Library of Munich, Germany.
- Antonio Ruiz Porras & William Henry Steinwascher Sacio, 2008. "Gobierno corporativo, diversificación estratégica y desempeño empresarial en México," Revista de Administración, Finanzas y Economía (Journal of Management, Finance and Economics), Tecnológico de Monterrey, Campus Ciudad de México, vol. 2(1), pages 58-73.
- Klaus Gugler & Dennis C. Mueller & B. Burcin Yurtoglu, 2007. "Corporate Governance and the Determinants of Investment," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 163(4), pages 598-626, December.
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- Stijn Claessens, 2006. "Corporate Governance and Development," World Bank Research Observer, World Bank Group, vol. 21(1), pages 91-122.
- Madden, Gerald P., 1982. "The separation of ownership from control and investment performance," Journal of Economics and Business, Elsevier, vol. 34(2), pages 149-152.
- Brian Cheffins and Steven Bank, 2009. "Is Berle and Means Really a Myth?," Business History Review, Harvard Business School, vol. 83(3), pages 443-474, September.
- Kadapakkam, Palani-Rajan & Kumar, P. C. & Riddick, Leigh A., 1998. "The impact of cash flows and firm size on investment: The international evidence," Journal of Banking & Finance, Elsevier, vol. 22(3), pages 293-320, March.
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