An OLG Model of Common Ownership: Effects on Consumption and Investments

Oz Shy; Rune Stenbacka

doi:10.1016/j.jmacro.2019.103155

An OLG Model of Common Ownership: Effects on Consumption and Investments

Oz Shy, Rune Stenbacka

Economics, Helsinki

Federal Reserve Bank of Atlanta

Research output: Contribution to journal › Article › Scientific › peer-review

5 Citations (Scopus)

Abstract

We analyze how an increase in the degree of common ownership of firms in the same market affects consumption and investment. Such an increase is shown to reduce real investment and therefore intertemporal consumption. Overall, institutional investors’ common ownership of firms competing in the same market serves as a device for weakening market competition. The resulting increase in the price of acquiring shares with institutional investors then crowds out savings directed to real investments.

Original language	English
Peer-reviewed scientific journal	Journal of Macroeconomics
Volume	62
ISSN	0164-0704
DOIs	https://doi.org/10.1016/j.jmacro.2019.103155
Publication status	Published - 23.08.2019
MoE publication type	A1 Journal article - refereed

Keywords

511 Economics
Common ownership
institutional investors
real versus financial investments
market power
savings and investments
investment crowding-out
overlapping generations

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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KW - overlapping generations

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An OLG Model of Common Ownership: Effects on Consumption and Investments

Abstract

Keywords

UN SDGs

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