Passive blockholders, informational efficiency of prices, and firm value
| Autor: | Kee H. Chung, Carl Hsin-han Shen, Choonsik Lee |
|---|---|
| Rok vydání: | 2019 |
| Předmět: |
040101 forestry
Economics and Econometrics Schedule 050208 finance Corporate governance 05 social sciences Enterprise value 04 agricultural and veterinary sciences Monetary economics Market liquidity 0502 economics and business 0401 agriculture forestry and fisheries Business Finance Economic consequences Stock (geology) |
| Zdroj: | Review of Financial Economics. 38:494-512 |
| ISSN: | 1873-5924 1058-3300 |
| DOI: | 10.1002/rfe.1089 |
| Popis: | This paper analyzes the role of passive blockholders in corporate governance using data on Schedule 13G filings. We show that firm value increases with the number and aggregate ownership of passive blockholders after controlling for other possible determinants of firm value. More importantly, we show that the informational efficiency of prices (IEP) increases with the number and aggregate ownership of passive blockholders, and IEP is a channel through which passive blockholders affect firm value. Overall, our results suggest that managers perform better when stock prices reflect the economic consequences of their actions promptly and accurately through information-based trading of blockholders. |
| Databáze: | OpenAIRE |
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