Local ownership as private information: Evidence on the monitoring-liquidity trade-off

• 成果类型: Article
• 署名作者: Gaspar, Jose-Miguel; Massa, Massimo
• 署名单位: INSEAD Business School; ESSEC Business School
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2005.10.010
• 发表日期: 2007
• 页码: 751-792
• 关键词: local ownership; corporate governance; liquidity; monitoring; Mutual funds; private information

摘要

We investigate how ownership patterns affect the way the firm is monitored, the liquidity of its shares, and its stock price. We show that informed ownership improves governance and induces value-enhancing decisions (less over-investment and fewer but better acquisitions). At the same time, it increases the adverse selection discount required by less informed investors to trade, reducing the firm's liquidity. Both effects are impounded in the stock price. This explains why ownership seems to be unrelated to performance. Informed investors affect prices in opposite directions: monitoring would raise prices, but the lower liquidity induced by their presence would reduce them. (c) 2006 Elsevier B.V. All rights reserved.