Divide and Privatize: Firm Break-up and Performance

Evžen Kočenda and Jan Hanousek

No 3465, CESifo Working Paper Series from CESifo

Abstract: We analyze the long-term effects of firm break-up and ownership change on corporate performance. Our analysis is based on a unique data set for a large number of Czech firms spanning the period 1996–2005. We employ a propensity score matching procedure to deal with endogeneity problems. Our results, which are generally in line with the positive effects of firm break-up found in the developed-market literature, show that the initial effects of firm break-up are positive but after a certain point they quickly diminish over time. Factors like changes in ownership structure and management are to be found behind later improvements in the performance of firms.

Keywords: break-up of firms; corporate performance; ownership changes; privatization; emerging markets; endogeneity; propensity score matching procedure (search for similar items in EconPapers)
JEL-codes: D23 G32 G34 L20 M21 P47 (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Divide and Privatize: Firms Break-up and Performance (2010)
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