S-Space College of Social Sciences (사회과학대학) Institute of Economics Research (경제연구소) Seoul Journal of Economics Seoul Journal of Economics vol.33 no.1/4 (2020)
Management Ownership and Firm Value: An Empirical Analysis using Panel Data
- Lee, Sang-Mook; Ryu, Keunkwan
- Issue Date
- Seoul Journal of Economics, Vol.33 No.1, pp. 1-17
- Convergence-of-interest; Entrenchment; Information asymmetry; Management ownership; Panel data
- A majority of existing empirical studies report different relation between ownership and firm value using different sets of cross-sectional data. In this paper, we re-estimate the relation between management ownership and firm value after controlling for the history of management ownership as well as inter-firm differences using a panel data set. Further, we consider the possibility that the current ownership structure is jointly determined with the firm value, an endogeneity argument a la Demsetz (1983). We find that history of the management ownership, not its current level, matters in determining the firm value, which is consistent with information asymmetry arguments.