Hi-Stat img
□ ENGLISH
□ HOME
□ プロジェクト概要
組織図

概念図

スタッフ
□ 研究成果
ディスカッションペーパー

データベース
□ お知らせ
公募情報

研究会日程

過去の研究会と報告資料

レクチャーシリーズ

過去のレクチャーと報告資料

ニュースレター
□ リンク
一橋大学

一橋大学附属図書館

一橋大学経済研究所

社会科学統計情報研究センター

アジア長期経済統計プロジェクト

Global Economic History Network

政府統計ミクロデータの試行的提供

ICPSR データアーカイブ

AMU and AMU Deviation indicators

The Impact of Product Market Competition on
Private Benefits of Control



Maria Guadalupe and Francisco Perez-Gonzalez


March, 2006


Previous paper Next paper
Abstract
This paper investigates the impact of product market competition (PMC) on private benefits of control (PBC). We estimate PBC using the voting premium between shares with differential voting rights. We use two measures of the intensity of product market competition: an external competition measure based on industry-level import penetration, and an internal measure derived from domestic product market regulations. Using data for publicly-traded firms in 19 countries for which information on dual class shares is available we find that PMC is strongly negatively correlated with PBC. The evidence indicates that the effect is particularly strong for firms in industries that are likely to be concentrated and in countries with poor legal environments. We further examine the channels through which PMC enhances governance. We find evidence indicating that improvements in the availability of industry information and the higher default probability associated with tougher competition are two important forces in reducing the estimated price gap between dual class shares. Using exchange rates and terms of trade as instruments for import penetration, we find that the link between competition in product markets and private benefits of control is not spurious. Overall, our results suggest that product market competition can help in curbing private benefits of control.
Download (262KB)
Copyright (C) 2003-2007 by Institute of Economic Research.All rights reserved.