Is the company performance endogenous to ownership concentration? Evidence from the Romanian Mass Privatization
Diana Pop  1@  
1 : Groupe de Recherche ANgevin en Economie et Management  (Granem)  -  Site web
Université d'Angers
Faculté de droit, d\'économie et de gestion 13 allée François Mitterrand BP 13633 49036 Angers cedex 01 -  France

This study addresses one of the most controversial questions in corporate finance, namely the causal effect between the company performance and private ownership. We use the information related to the original design of the mass privatization in Romania in order to test whether the subscription decision of small private, non-pivotal, financially unconstrained and uncoordinated shareholders is performance-related. We propose three different metrics for the size of private ownership depending on the treatment applied to the degree of subscription of the privatization offer. Our results defend the idea that individuals behave in conformity with the percepts of the market theory and calls attention on the importance of the high quality disclosure enabling the market participants to make their own assessment.

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