Does common ownership really increase firm coordination?

Katharina Lewellen and Michelle Lowry ()

Journal of Financial Economics, 2021, vol. 141, issue 1, 322-344

Abstract: A growing number of studies suggest that common ownership caused cooperation among firms to increase and competition to decrease. We take a closer look at four approaches used to identify these effects. We find that the effects that some studies have attributed to common ownership are caused by other factors, such as differential responses of firms (or industries) to the 2008 financial crisis. We propose a modification to one of the previously used empirical approaches that is less sensitive to these issues. Using this to re-evaluate the link between common ownership and firm outcomes, we find little robust evidence that common ownership affects firm behavior.

Keywords: Common ownership; Institutional ownership; Corporate governance (search for similar items in EconPapers)
JEL-codes: G23 G32 G34 L22 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (30)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jfinec:v:141:y:2021:i:1:p:322-344

DOI: 10.1016/j.jfineco.2021.03.008

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