KTH/CESIS Working Paper Series in Economics and Institutions of Innovation
Johan Eklund and Thomas Poulsen
One Share-One Vote: New Empirical Evidence
Abstract: Shares with more voting rights than cash flow rights
provide their owners with a disproportional influence that is often found
to destroy the value of outside equity. This is taken as evidence of
discretionary use of power. However, concentration of power does not
necessarily result from control enhancing mechanisms; it could also be that
some shareholders retain a large block in a one share-one vote structure.
In this paper, we develop a methodology to disentangle disproportionality,
which allows us to test the effect of deviations from one share-one vote
more precisely. Our empirical findings add to the existing literature.
Keywords: Ownership structure; one share-one vote; proportionality; performance; entrenchment; (follow links to similar papers)
JEL-Codes: G32; G34; (follow links to similar papers)
28 pages, October 26, 2010
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