Disentangling the incentive and entrenchment effects of large shareholdings

• 成果类型: Article
• 署名作者: Claessens, S; Djankov, S; Fan, JPH; Lang, LHP
• 署名单位: University of Amsterdam; The World Bank; Hong Kong University of Science & Technology; Chinese University of Hong Kong
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/1540-6261.00511
• 发表日期: 2002
• 页码: 2741-2771
• 关键词: CORPORATE GOVERNANCE; voting-rights; OWNERSHIP; MARKET

摘要

This article disentangles the incentive and entrenchment effects of large ownership. Using data for 1,301 publicly traded corporations in eight East Asian economies, we find that firm value increases with the cash-flow ownership of the largest shareholder, consistent with a positive incentive effect. But firm value falls when the control rights of the largest shareholder exceed its cash-flow ownership, consistent with an entrenchment effect. Given that concentrated corporate ownership is predominant in most countries, these findings have relevance for corporate governance across the world.