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Ownership Structure and Firm Performance in Russia: The Case of Blue Chips of the Stock Market

  • Kuznetsov, Pavel
  • Muravyev, Alexander

Based on panel data from 1995 – 1997, the paper focuses on the impact of ownership structure on the performance of Russian non-financial privatized companies that constitute the group of "blue chips" of the country's stock market. We find that ownership concentration results in higher technical efficiency of enterprises, but benefits from productivity improvements do not adequately materialize in higher profitability and market value of companies. This is consistent with the expropriation hypothesis that large owners use their power to extract private benefits of control. We also find that the association between ownership by different groups of owners and firm performance is relatively weak and subject to reversed causality. There is evidence that ownership by Russian non-state shareholders negatively affects firm value suggesting that this group of owners is inclined to the extraction of private benefits of control.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 27231.

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Date of creation: 2001
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Handle: RePEc:pra:mprapa:27231
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  17. Krueger, Anne O, 1990. "Government Failures in Development," Journal of Economic Perspectives, American Economic Association, vol. 4(3), pages 9-23, Summer.
  18. Anup Agrawal & Charles R. Knoeber, . "Firm Performance and Mechanisms to Control Agency Problems between Managers and Shareholders (Revision of 29-94)," Rodney L. White Center for Financial Research Working Papers 08-96, Wharton School Rodney L. White Center for Financial Research.
  19. Alan Bevan & Saul Estrin & Mark E. Schaffer, 1999. "Determinants of Enterprise Performance during Transition," CERT Discussion Papers 9903, Centre for Economic Reform and Transformation, Heriot Watt University.
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