Ownership structure, investment, and the corporate value: An empirical analysis

doi:10.1016/S0304-405X(97)00039-1

Journal of Financial Economics

Volume 47, Issue 1, January 1998, Pages 103-121

https://doi.org/10.1016/S0304-405X(97)00039-1 Get rights and content

Abstract

This paper examines the relation among ownership structure, investment, and corporate value, focusing on whether ownership structure affects investment. Ordinary least squares regression results suggest that ownership structure affects investment and, therefore, corporate value. However, simultaneous regression results indicate that the endogeneity of ownership may affect these inferences, suggesting that investment affects corporate value which, in turn, affects ownership structure. The evidence shows that corporate value affects ownership structure, but not vice versa. These findings raise questions regarding the assumption that ownership structure is exogenously determined, and bring into question the results in studies that treat ownership structure as exogenous.

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Ownership structure, investment, and the corporate value: An empirical analysis

Abstract

Journal of Financial Economics

Journal of Financial Economics

Journal of Financial Economics

Journal of Financial Economics

Journal of Accounting and Economics

Journal of Financial Economics

The structure of corporate ownership: causes and consequences

Journal of Political Economy

Financing constraints and corporate investment

Brookings Papers on Economic Activity