Topic
Corporate group
About: Corporate group is a research topic. Over the lifetime, 1747 publications have been published within this topic receiving 46868 citations.
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TL;DR: In contrast to what is widely believed, German banks do not dominate companies even though they exert considerable influence through industrial holdings, supervisory board mandates and proxy voting rights in addition to their regular banking business as discussed by the authors.
Abstract: The article presents the German system of corporate control. Compared with the UK, the number of listed joint-stock companies in Germany is relatively low. The most important shareholders are companies, whereas institutional investors play a minor role. An essential feature of German corporate culture is the concept of the interest of the company as a whole and the long-term approach in pursuing company goals. Joint-stock companies operate under a two-tier structure with a managing board controlled by the supervisory board, the body which plays the central role in corporate governance in Germany. In contrast to what is widely believed, German banks do not dominate companies even though they exert considerable influence through industrial holdings, supervisory board mandates and proxy voting rights in addition to their regular banking business. Control via the market is less pronounced here than in the UK but is growing in importance. Copyright 1992 by Oxford University Press.
58 citations
TL;DR: The authors examined the relationship between the acquisition of foreign technology and firm size, liquidity and affiliation with a corporate group, and found that the number of licensing agreements a firm signs is positively and strongly related to its size, although the relationship is concave.
58 citations
TL;DR: In this paper, the authors analyzed the impact of firm strategy and industry structure as well as business group membership and state support on firm performance in an advanced emerging economy, Turkey using a data set compiled from a selection of the 1000 largest manufacturing firms in this country, and employed several regression models to identify the main determinants of firm performance as measured by productivity and net profit margin.
58 citations
TL;DR: In this article, the authors examined whether the presence of business group affiliated firms in industries restricts the entry of unaffiliated firms or firms affiliated with small and medium-size business groups, and found that investments by business groups affiliated with large-sized business groups have a U-shaped relationship with the investment by affiliates of small-and medium business groups.
Abstract: Business groups dominate the economic landscape in many economies around the world. While business groups overcome the institutional voids arising due to inefficiencies of external markets, they also possess market power, which could be economically and socially counterproductive, especially for unaffiliated firms. Drawing on the transaction cost and industrial organization economics, we examine whether the presence of business group affiliated firms in industries restricts the entry of unaffiliated firms or firms affiliated with small- and medium-size business groups. Findings based on Indian firms suggest that investments by business group affiliated firms in an industry have an inverted U-shaped relationship with the investment by unaffiliated firms. However, investments by firms affiliated with large-sized business groups have a U-shaped relationship with the investment by affiliates of small and medium business groups. These findings suggest that the market power of business groups and entry barrier relationship is contingent on the size of the business groups.
57 citations
TL;DR: It is found that liberalization significantly affects and alters the relative importance of firm, industry, and group effects and that business group effects matter in explaining profitability variances.
Abstract: We assess absolute magnitudes, relative importance, and intertemporal differences in firm, industry, and business group effects in explaining the variance of Indian manufacturing firms' profitability over the 26-year period between 1980-1981 and 2005-2006. We stratify the data by institutional phases to place emphasis on the role of changing institutional factors in an emerging economy: first as a regime of command and control transits to partial liberalization between 1985 and 1991 and then to an open competitive market economy after 1991; thereafter, financial reforms occur, followed by legal reforms. We find that liberalization significantly affects and alters the relative importance of firm, industry, and group effects. Firm effects are always important, whether in a command and control regime, with benefits accruing from protectionism and political rent seeking, or in liberalized periods where firm-specific capabilities and dynamic efficiencies are valued. Industry effects are significant in the command and control regime, when mandatory sector placement benefits firms in industries with superior profits, and in the liberalized period, when the choice of the industry segment in which to operate is open to firms. Thereafter, industry effects dissipate. Business group effects matter in explaining profitability variances. Group effects' magnitudes, however, do not change significantly over time.
57 citations