Does Corporate Ownership matter for Firm Performance? Evidence from Chinese Stock Exchanges
Dilesha Rathnayake (),
Diby Francois Kassi (),
Pierre Axel Louembé,
Gang Sun and
Additional contact information
Pierre Axel Louembé: School of Accounting, Dongbei University of Finance and Economics, 217, Jianshan Street, Shahekou, Dalian, PR China.
Gang Sun: School of Finance, Dongbei University of Finance and Economics, 217, Jianshan Street, Shahekou, Dalian, PR China,
Ding Ning: School of Finance, Dongbei University of Finance and Economics, 217, Jianshan Street, Shahekou, Dalian, PR China,
International Journal of Economics and Financial Issues, 2019, vol. 9, issue 1, 96-107
This paper examines the impact of corporate ownership structure and ownership concentration on the corporate performance of listed firms in China. Ordinary Least Square (OLS) and Two-Stages Least Squares (2SLS) models are used to capture the relationship between the independent variables and firm performance by considering the possible endogeneity of both performance and ownership variables. The ownership structure variables (executive shares, State shares, legal shares, and Negotiable A-shares) are negatively related with firm performance measured by Tobin's Q ratio. The proportion of state-owned shares and negotiable A-shares are significantly correlated with the firm profitability. Second, the results show that Chinese firm ownership is severely concentrated. The top ten largest shareholders accounted for 60% of the outstanding shares in 2017 and had a strong positive relationship with firm performance. In contrast, the largest shareholder's ownership concentration ratio variable has a significant negative relationship with the firm performance.
Keywords: Ownership structure; Ownership concentration; firm performance; China; Endogeneity (search for similar items in EconPapers)
JEL-codes: G1 G10 G18 G32 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eco:journ1:2019-01-12
Access Statistics for this article
International Journal of Economics and Financial Issues is currently edited by Ilhan Ozturk
More articles in International Journal of Economics and Financial Issues from Econjournals
Bibliographic data for series maintained by Ilhan Ozturk ().