Ownership structure and efficiency in Taiwanese electronics firms

Yan-Jie Yang, Jengfang Chen, Qian Long Kweh and Hsin Chi Chen

Review of Accounting and Finance, 2013, vol. 12, issue 4, 351-368

Abstract: Purpose - – This study aims to examine the effect of the separation of control and ownership on the efficiency performance of Taiwanese electronics firms. Design/methodology/approach - – The paper employs data envelopment analysis to estimate efficiency performance. Following Kuanet al., the paper measures the severity of a firm's agency problems using the difference between voting rights and cash flow rights, and the difference between seat control rights and cash flow rights. Using a panel dataset for the period from 2004 to 2010, the paper runs OLS regressions to find the relationship between efficiency performance and the separation of control and ownership. Findings - – The results show that both the divergence between voting rights and cash flow rights, and the divergence between seat control rights and cash flow rights are significantly and negatively related to efficiency performance. Using Tobit regression in the second stage also provides a consistent result. Research limitations/implications - – Shareholders, especially the minority group, should think twice before investing in a firm with a high deviation of control and ownership. Originality/value - – This is the first paper to examine the effect of the separation of control and ownership on the efficiency performance of Taiwanese electronics firms. The empirical evidence suggests existence of negative entrenchment effects in the electronics industry in Taiwan.

Keywords: Ownership structure; Efficiency; Data envelopment analysis; Electronics firms (search for similar items in EconPapers)
Date: 2013
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

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:eme:rafpps:v:12:y:2013:i:4:p:351-368

DOI: 10.1108/RAF-07-2012-0063

Access Statistics for this article

Review of Accounting and Finance is currently edited by Nawazish Mirza

More articles in Review of Accounting and Finance from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().