Does corporate control matter to financial volatility?
Laura Gianfagna () and
Armando Rungi ()
No 09/2017, Working Papers from IMT Institute for Advanced Studies Lucca
In our contribution we study how the ownership channel affects the stock price volatility of listed stock markets. In particular, we study how a linkage between a parent company and its affiliates may drive differences in stock price volatility, within and across countries. We exploit a worldwide dataset of stock-exchange listed firms, controlling for several financial dimensions, to assess whether business groups matter to financial volatility. The answer is positive and does not depend on the definition of volatility used. Our results contribute to the corporate finance literature by defining the role of multinational corporate control in financial markets, and to the financial stability literature by assessing corporate control as an undiscovered channel of transmission for financial shocks.
Keywords: corporate control; stock price volatility; multilevel model (search for similar items in EconPapers)
JEL-codes: F23 G32 (search for similar items in EconPapers)
Date: 2017-11, Revised 2017-11
New Economics Papers: this item is included in nep-cfn and nep-rmg
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Published in EIC working paper series
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http://eprints.imtlucca.it/3842/1/EIC_WP_9_2017.pdf First version, 2017
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Persistent link: https://EconPapers.repec.org/RePEc:ial:wpaper:9/2017
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