Restructuring of insider-dominated firms

Simeon Djankov

No 2046, Policy Research Working Paper Series from The World Bank

Abstract: Using enterprise survey data for 1995-97, the author studies and compares how different modes of privatizing to insiders affect enterprise restructuring in two former Soviet republics, Georgia and Moldova. Restructuring in companies in which incumbent managers received significant ownership stakes for free was similar to that in companies that were still state-owned. By contrast, restructuring was faster in companies bought by their managers. The author interprets these results as suggesting that managers'incentives to restructure decrease when they regard their newly acquired ownership as a windfall gain.

Keywords: Microfinance; Small and Medium Size Enterprises; Banks&Banking Reform; Small Scale Enterprise; Financial Crisis Management&Restructuring; Private Participation in Infrastructure; Microfinance; Small Scale Enterprise; Financial Crisis Management&Restructuring; Banks&Banking Reform (search for similar items in EconPapers)
Date: 1999-01-31
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Citations: View citations in EconPapers (12)

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