Synchronicity and firm interlocks in an emerging market

• 成果类型: Article
• 署名作者: Khanna, Tarun; Thomas, Catherine
• 署名单位: Columbia University; Harvard University
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2008.03.005
• 发表日期: 2009
• 页码: 182-204
• 关键词: Information and market efficiency; international financial markets; Latin America

摘要

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. (C) 2008 Elsevier B.V. All rights reserved.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. (C) 2008 Elsevier B.V. All rights reserved.