Working Paper Series, Department of Economics, Copenhagen Business School
Morten Bennedsen, Martin Junge, Jesper Kragh Jacobsen, Svend Torp Jespersen and Kasper Meisner Nielsen
Ownership structure and economic performance of European corporations
Abstract: Firms in the European countries today have the possibility
of choosing from a range of control enhancing mechanisms giving the
controlling owners an amount of influence which is disproportional to their
share of cash flow. The list of control enhancing mechanisms includes dual
class shares, pyramidal ownership structures and several others. The
justification for these control enhancing mechanisms is currently the
subject of much debate within the European Union. The opposing positions in
the debate can be stated briefly as i) the control enhancing mechanisms are
an impediment to takeovers and should therefore be removed to improve the
market for corporate control. ii) Removing the control enhancing mechanisms
reduces the contractual freedom to decide desirable ownership structures.
This report investigates whether ownership structures affect firm
performance. To do so this study provides a description of the current
ownership structures in European countries and the economic outcomes for
firms using different ownership structures. The results are presented in
the tables below.
Keywords: na; (follow links to similar papers)
JEL-Codes: G10; (follow links to similar papers)
50 pages, January 1, 2007
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