Management ownership and market valuation: an empirical analysis

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Randall Morck
Andrei Schleifer
Robert W. Vishny

Abstract

We investigate the relationship between management ownership and market valuation of the firm, as measured by Tobin's Q. In a 1980 cross-section of 371 Fortune 500 firms, we find evidence of a significant nonmonotonic relationship. Tobin's Q first increases, then declines, and finally rises slightly as ownership by the board of directors rises. For older firms, there is evidence that Q is lower when the firm is run by a member of the founding family than when it is run by an officer unrelated to the founder.

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How to Cite
MORCK, R.; SCHLEIFER, A.; VISHNY, R. W. Management ownership and market valuation: an empirical analysis. RAE - Revista de Administracao de Empresas , [S. l.], v. 48, n. 2, p. 126–143, 2008. Disponível em: https://periodicos.fgv.br/rae/article/view/36613. Acesso em: 26 may. 2024.
Section
RAE - Clássicos