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Institutional Investors, Common Control, and Risk: An Investigation into Motives and Consequences

Authors :
Wang, Ping
Barrese, James
Source :
Review of Business. January, 2019, Vol. 39 Issue 1, p45, 15 p.
Publication Year :
2019

Abstract

This paper provides a synthesis of the recent literature related to corporate ownership issues and theoretical models of corporate and industry interactions linked through common ownership by institutional investors. The paper elaborates a theme observed by Azar and others with a focus on airlines (2017) and banking (2016). We supply a mathematical framework suggesting that homogeneity in operations of firms under common ownership may put the institutional owner's long-term interest at risk. To stimulate future research, we present a preliminary analysis of two sampled industries. Common ownership is also observed in other industries.<br />DIVERSIFIED VERSUS CONCENTRATED CORPORATE OWNERSHIP Before the Industrial Revolution, most business organizations were sole proprietorships or partnerships. After the Industrial Revolution, the scale of and the demand for capital in [...]

Details

Language :
English
ISSN :
00346454
Volume :
39
Issue :
1
Database :
Gale General OneFile
Journal :
Review of Business
Publication Type :
Periodical
Accession number :
edsgcl.572144945