Common ownership, institutional investors, and welfare

Oz Shy, Rune Stenbacka*

*Corresponding author for this work

Research output: Contribution to journalArticleScientificpeer-review

Abstract

This study evaluates the effects of institutional investors' common ownership of firms competing in the same market. Overall, common ownership has two opposing effects: (a) it serves as a device for weakening market competition, and (b) it induces diversification, thereby reducing portfolio risk. We conduct a detailed welfare analysis within which the competition‐softening effects of an increased degree of common ownership is weighted against the associated diversification benefits.
Original languageEnglish
Peer-reviewed scientific journalJournal of Economics & Management Strategy
Volume29
Issue number3
Pages (from-to)706-723
Number of pages18
ISSN1058-6407
DOIs
Publication statusPublished - 30.05.2020
MoE publication typeA1 Journal article - refereed

Keywords

  • 511 Economics

Fingerprint Dive into the research topics of 'Common ownership, institutional investors, and welfare'. Together they form a unique fingerprint.

  • Cite this