Agency Costs in Small Firms

Milo Bianchi and Henri Luomaranta

No 21-1252, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: We explore how CEO ownership a¤ects productivity in small and large firms. We use administrative panel data on the universe of limited lia- bility firms in Finland and exploit plausibly exogenous variations to CEO ownership induced by shocks to the CEO spouse's health. We document a substantial increase in productivity when the CEO obtains majority owner- ship or when the majority owner becomes the CEO. While typical samples focus on large public rms, we show that our e¤ects are stronger in medium- sized private firms. Consistently with the quiet life hypothesis, we show that increased ownership boosts CEO's effort at work.

Keywords: CEO ownership; firm productivity; SME. (search for similar items in EconPapers)
JEL-codes: D24 E23 G30 L25 M12 (search for similar items in EconPapers)
Date: 2021-08, Revised 2025-09
New Economics Papers: this item is included in nep-bec, nep-cwa, nep-eur, nep-hrm, nep-ind, nep-isf and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.tse-fr.eu/sites/default/files/TSE/docu ... 2021/wp_tse_1252.pdf Working paper (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:125982

Access Statistics for this paper

More papers in TSE Working Papers from Toulouse School of Economics (TSE) Contact information at EDIRC.
Bibliographic data for series maintained by ().