This paper analyses the ownership structure emerging from the Russian privatization process, using information from a sample survey of 439 state and privately-owned manufacturing companies conducted in July 1994, just after the voucher programme was completed. The Russian ownership structure...

The Paper takes a first look at the host and home country effects of German foreign direct investment (FDI) in Eastern Europe based on new survey data of 1050 investment projects in Eastern Europe by 420 German multinationals during the 1990s. We find that German investors transfer a substantial...

I analyse the effects of competition on R&D effort (in a non-tournament context) and obtain robust results that hold for a variety of market structures, including markets with and without barriers to entry and markets characterized by either price or quantity competition. The approach...

We present a novel source of disagreement grounded in decision theory: ambiguity aversion. We show that ambiguity aversion generates endogenous disagreement between a firm's insider and outside shareholders, creating a new rationale for corporate governance systems. In our paper, optimal...

This paper presents a rational expectations model of optimal executive compensation in a setting where managers are in a position to manipulate short-term stock prices, and managers' propensity to manipulate is uncertain. Stock-based incentives elicit not only productive effort, but also costly...

Mutual funds are significant blockholders in many corporations. Concerns that funds vote in a pro-management manner to garner lucrative pensions contracts led the SEC to mandate the disclosure of proxy votes. We present a model of mutual fund voting in the presence of potential business ties. We...

We study the relationship between liquid asset holding and the pattern of share ownership and control structures within the firm. We explore these issues using a data set of Belgian firms that is particularly well suited to studying the institutions of control oriented finance. The data include...

We shed new light on the corporate governance role of institutional investors in markets where concentrated ownership and business groups are prevalent. When companies have controlling shareholders, institutional investors, as minority shareholders, can play only a limited role in corporate...

We test under what circumstances boards discipline managers and whether such interventions improve performance. We exploit exogenous variation due to the staggered adoption of corporate governance laws in formerly Communist countries coupled with detailed ‘hard’ information about the...

We develop a model of internal governance where the self-serving actions of top management are limited by the potential reaction of subordinates. We find that internal governance can mitigate agency problems and ensure firms have substantial value, even without any external governance. Internal...