Journal ArticleDOI
Firm Performance and Mechanisms to Control Agency Problems between Managers and Shareholders
Anup Agrawal,Charles R. Knoeber +1 more
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The authors examined the use of seven mechanisms to control agency problems between managers and shareholders, including shareholdings of insiders, institutions, and large blockholders, use of outside directors, debt policy, managerial labor market, and market for corporate control.Abstract:
This paper examines the use of seven mechanisms to control agency problems between managers and shareholders. These mechanisms are: shareholdings of insiders, institutions, and large blockholders; use of outside directors; debt policy; the managerial labor market; and the market for corporate control. We present direct empirical evidence of interdependence among these mechanisms in a large sample of firms. This finding suggests that crosssectional OLS regressions of firm performance on single mechanisms may be misleading. Indeed, we find relationships between firm performance and four of the mechanisms when each is included in a separate OLS regression. These are insider shareholdings, outside directors, debt, and corporate control activity. Importantly, the effect of insider shareholdings disappears when all of the mechanisms are included in a single OLS regression, and the effects of debt and corporate control activity also disappear when estimations are made in a simultaneous systems framework. Together, these findings are consistent with optimal use of each control mechanism except outside directors.read more
Citations
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Journal ArticleDOI
Impression Management in Letters to Shareholders: Evidence from Poland
TL;DR: In this article, the authors study impression management in an emerging market setting with high ownership concentration using content analysis and identify impression management techniques in a sample of letters to share with the authors.
Book ChapterDOI
Corporate Governance and Firm Valuation in Asian Emerging Markets
Yan-Leung Cheung,J. Thomas Connelly,Jesus P. Estanislao,Piman Limpaphayom,Tong Lu,Sidharta Utama +5 more
TL;DR: In this article, the authors investigated the relation between the quality of corporate governance practices and market valuation for listed firms in five Asian economies: China, Hong Kong, Indonesia, the Philippines, and Thailand.
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Characteristics of Corporate Boards in Single-Industry and Conglomerate Media Companies
TL;DR: This article examined board compositions of 21 firms with leadership positions in one or more traditional mass media industries and compared governance structure and results for those firms that are concentrated in one media segment to those that operate multiple media segments.
Journal ArticleDOI
Determinants of tourism hotel market efficiency
Sami Ben Aissa,Mohamed Goaied +1 more
TL;DR: In this paper, a bootstrapped truncated regression model is used to evaluate the hotel performance determinants by examining the impact of the internal and the external environment of the hotel on its performance.
Journal ArticleDOI
Board Attributes and Financial Performance: The Evidence from an Emerging Economy
TL;DR: In this article, the impact of board characteristics on financial performance of the listed companies in Pakistan Stock Exchange, Pakistan has been explored, where various board parameters such as board size, number of meetings, board independence, audit committee independence, gender diversity in board and executive directors' compensation are addressed in this study.
References
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Management Ownership and Market Valuation: An Empirical Analysis
TL;DR: This article investigated the relationship between management ownership and market valuation of the firm, as measured by Tobin's Q. In a 1980 cross-section of 371 Fortune 500 firms, they found evidence of a significant nonmonotonic relationship.
Journal ArticleDOI
The Structure of Corporate Ownership: Causes and Consequences
Harold Demsetz,Kenneth Lehn +1 more
TL;DR: In this paper, the authors argue that the structure of corporate ownership varies systematically in ways that are consistent with value maximization, and they find no significant relationship between ownership concentration and accounting profit rates for a set of firms.
Journal ArticleDOI
The Determinants of Capital Structure Choice
TL;DR: In this paper, the explanatory power of some of the recent theories of optimal capital structure is analyzed empirically and a factor-analytic technique is used to mitigate the measurement problems encountered when working with proxy variables.
Journal ArticleDOI
Additional evidence on equity ownership and corporate value
John J. McConnell,Henri Servaes +1 more
TL;DR: The authors investigated the relation between Tobin's Q and the structure of equity ownership for a sample of 1,173 firms for 1976 and 1,093 firms for 1986 and found a significant curvilinear relation between Q and common stock owned by corporate insiders.
Journal ArticleDOI
On the existence of an optimal capital structure: theory and evidence
TL;DR: In this article, the authors show that if there are significant "leverage-related" costs, such as bankruptcy costs, agency costs of debt, and loss of non-debt tax shields, then the marginal bondholder's tax rate will be less than the corporate rate and there will be a positive net tax advantage to corporate debt financing.