Managerial ownership and performance

Aydin Ozkan, Chrisostomos Florackis, Alexandros Kostakis

Research output: Contribution to journalArticle

33 Citations (Scopus)

Abstract

This study revisits the classical debate about the nature of the relationship between managerial ownership and corporate performance by using a semi-parametric estimation approach. The semi-parametric approach helps sidestep concerns associated with the potential misspecification of parametric models (e.g., the arbitrary choice of a fixed number and/or location of turning points) and enables the consideration of a wider range of non-linear behaviors. The empirical results support the existence of the initial alignment effect of managerial ownership at levels lower than 15%, while they do not lead to a strong inference on the relationship between managerial ownership and corporate performance for intermediate and high levels of managerial ownership. The results cast doubt on the findings of recent studies on the subject, which critically rely on fully parametric methods, and instead suggest the use of semi-parametric methods in estimating the shape of the ownership-performance curve.

LanguageEnglish
Pages1350-1357
Number of pages8
JournalJournal of Business Research
Volume62
Issue number12
DOIs
Publication statusPublished - 1 Dec 2009
Externally publishedYes

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Managerial performance
Managerial ownership
Corporate performance
Parametric model
Ownership
Empirical results
Turning point
Semiparametric methods
Semiparametric estimation
Misspecification
Alignment
Inference

Cite this

Ozkan, Aydin ; Florackis, Chrisostomos ; Kostakis, Alexandros. / Managerial ownership and performance. In: Journal of Business Research. 2009 ; Vol. 62, No. 12. pp. 1350-1357.
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Managerial ownership and performance. / Ozkan, Aydin; Florackis, Chrisostomos; Kostakis, Alexandros.

In: Journal of Business Research, Vol. 62, No. 12, 01.12.2009, p. 1350-1357.

Research output: Contribution to journalArticle

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