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INSIDERS OWNERSHIP AND FIRM VALUE IN SOUTHERN EUROPE
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Rebeca García-Ramos, Myriam García Olalla 
Abstract
The effectiveness of the insider ownership as an internal governance mechanism is addressed in the Southern European context using a sample of publicly traded firms during the 2001-2007 periods. A cross country and panel data design is used, taking into account the endogeneity problem arising in studies of corporate governance. The results provide new evidence of the influence of the insider ownership on firm value by testing a non-linear relationship. Our study supports both the convergence of interests and the entrenchment effect. It also shows whether there are significant differences in the estimated relationship between family and non-family firms. We find that when the large shareholder has not a family nature, firm value initially declines with insider ownership, then increases, and, finally, increases again. However, when the large shareholder has a family nature, firm value initially increases with insider ownership and then decreases.
Keywords: Corporate Governance, Insider Ownership, Large Family Shareholder, Firm Value, Endogeneity, Listed Firms
How to cite this paper:García-Ramos, R., & García Olalla, M. G. (2012). Insiders ownership and firm value in southern Europe. Corporate Ownership & Control, 9(2-5), 498-510. https://doi.org/10.22495/cocv9i2c5art4
