Corporate Ownership Structure and Firm Performance: Evidence from Greek Firms

Panayotis Kapopoulos () and Sophia Lazaretou ()

No 37, Working Papers from Bank of Greece

Abstract: The Berle-Means thesis (1932) implies that diffuse ownership adversely affects firm performance. This paper tries to investigate whether there is strong evidence to support the notion that variations across firms in observed ownership structures result in systematic variations in observed firm performance. We test this hypothesis by assessing the impact of the structure of ownership on corporate performance, measured by profitability, using data for 175 Greek listed firms. Following Demsetz and Villalonga (2001) we model ownership structure, first, as an endogenous variable and, second, we consider two different measures of ownership structure reflecting different groups of shareholders with conflicting interests. Empirical findings suggest that a more concentrated ownership structure positively relates to higher firm profitability. We also find that higher firm profitability requires a less diffused ownership.

Keywords: Money demand; Ownership structure; Firm performance (search for similar items in EconPapers)
JEL-codes: G32 G34 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2006-04
New Economics Papers: this item is included in nep-cse and nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Journal Article: Corporate Ownership Structure and Firm Performance: evidence from Greek firms (2007)
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