Do Publicly Traded Firms Price Differently from Private Firms?

Ernesto Schargrodsky

American Law and Economics Review, 2003, vol. 5, issue 1, 32-60

Abstract: This article analyzes whether publicly traded firms price differently from privately held firms in the product markets. Our empirical evidence shows that, in the U.S. newspaper industry, firms increase their prices when their ownership structure changes from private to public. The effects are robust and significant. A plausible explanation is that private owners enjoy more freedom than public managers to expand circulation and distort content, pursuing the consumption of nonpecuniary benefits of control. Additional evidence is consistent with this interpretation. Public newspapers show lower prices when insiders' ownership participation is higher. Moreover, private newspapers appear more likely than public newspapers to endorse a candidate during presidential campaigns. To my knowledge there are no previous studies comparing pricing by private and public companies. Copyright 2003, Oxford University Press.

Date: 2003
References: Add references at CitEc
Citations: View citations in EconPapers (4)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:oup:amlawe:v:5:y:2003:i:1:p:32-60

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

American Law and Economics Review is currently edited by J.J. Prescott and Albert Choi

More articles in American Law and Economics Review from American Law and Economics Association Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK.
Bibliographic data for series maintained by Oxford University Press ().