Do institutional shareholders police management?

Paul Clyde
Additional contact information
Paul Clyde: National Economic Research Associates, Washington, DC, USA, Postal: National Economic Research Associates, Washington, DC, USA

Managerial and Decision Economics, 1997, vol. 18, issue 1, 1-10

Abstract: Some have argued that legislation limits the ability of institutional shareholders to discipline shirking management teams. However the level of takeover activity in the 1980s suggests that the cost of using takeovers to discipline management has decreased. This may give institutional shareholders the ability to participate actively in corporate governance. This paper presents an empirical examination that is consistent with this hypothesis. First, institutional ownership concentration varies across firms according to the benefits of policing firms in 1988. The relationship is less pronounced in 1980. Second, firms characterized by concentrated institutional ownership are more likely to use takeovers as the disciplinary mechanism. © 1997 John Wiley & Sons, Ltd.

Date: 1997
References: Add references at CitEc
Citations: View citations in EconPapers (6)

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:wly:mgtdec:v:18:y:1997:i:1:p:1-10

DOI: 10.1002/(SICI)1099-1468(199702)18:1<1::AID-MDE796>3.0.CO;2-0

Access Statistics for this article

Managerial and Decision Economics is currently edited by Antony Dnes

More articles in Managerial and Decision Economics from John Wiley & Sons, Ltd.
Bibliographic data for series maintained by Wiley Content Delivery ().