In this paper we use Heckman selection models to analyze the relation between the likelihood of the firm becoming a takeover target, the takeover premium, and the use of dual class shares. Ordinary Least Squares regressions suggest that the use of dual class shares is associated with higher...

Some studies have provided evidence that dual class shares reduce firm market value. Other studies have shown that dual class shares are more common in countries where the proxies for private benefits of control are low. In this paper we explore whether the negative relation between firm market...