A Hybrid Approach to Sunsetting Dual-class Shares

2021 ◽  
Author(s):  
Yiming Sun
Keyword(s):  
Hybrid Approach ◽  
Dual Class Shares ◽  
Dual Class

Price Effects of Dual-Class Shares

1986 ◽  
Vol 42 (1) ◽  
pp. 58-67 ◽  
Author(s):  
Vijay M. Jog ◽  
Allan L. Riding
Keyword(s):  
Price Effects ◽  
Dual Class Shares ◽  
Dual Class

Founding Family Ownership and the Selection of Industry Specialist Auditors

2014 ◽  
Vol 28 (2) ◽  
pp. 261-276 ◽  
Author(s):  
Fei Kang
Keyword(s):  
Financial Reporting ◽  
Family Firms ◽  
Structure And Agency ◽  
Founding Family ◽  
Using Data ◽  
Dual Class Shares ◽  
Dual Class ◽  
Selection Of ◽  
Industry Specialist

SYNOPSIS This study examines how family firms' unique ownership structure and agency problems affect their selection of industry-specialist auditors. Using data from Standard & Poor's (S&P) 1500 firms, the results show that family firms are more likely to appoint industry-specialist auditors than non-family firms, which suggests that family firms have strong incentives to signal the quality of financial reporting. Additional analysis indicates that due to the potential entrenchment problems, family firms with family member CEOs or with dual-class shares have even a higher tendency to hire industry-specialist auditors to signal their disclosure quality.

Dual-Class Firms and Innovation after NAFTA

2020 ◽  
Vol 23 (01) ◽  
pp. 2050007
Author(s):  
Lei Gao ◽  
Andrey Zagorchev
Keyword(s):  
Trade Agreement ◽  
Operating Efficiency ◽  
Firm Innovation ◽  
Exogenous Shock ◽  
Managerial Entrenchment ◽  
Innovation Activities ◽  
Dual Class Shares ◽  
Dual Class ◽  
Improve Operating

We examine the effect of dual-class shares on U.S. firm innovation after the exogenous shock of the 1994 North American Free Trade Agreement (NAFTA), which intensified international competition. Using difference-in-differences models, we find that dual-class structure firms become less innovative but improve operating efficiency following NAFTA. We show that dual-class firms in many manufacturing industries reduce innovation, but marginally increase capital expenditures after the agreement, and thus substitute risky innovation with safer, long-term investments. The findings indicate that firms with dual-class structures facing lower competition decrease their stock market related innovation activities. We find that dual-class firms with entrenched managers decrease innovation and improve operating efficiency following NAFTA. Based on the robust results, agency costs and managerial entrenchment could explain these changes in innovations, efficiency, and investments.

scholarly journals Anomalies: The Law of One Price in Financial Markets

2003 ◽  
Vol 17 (4) ◽  
pp. 191-202 ◽  
Author(s):  
Owen A Lamont ◽  
Richard H Thaler
Keyword(s):  
Economic Theory ◽  
Financial Markets ◽  
Financial Economic ◽  
Law Of One Price ◽  
Present Evidence ◽  
Country Funds ◽  
The Law ◽  
Dual Class Shares ◽  
Dual Class ◽  
Corporate Spinoffs

The Law of One price states that identical goods (or securities) should sell for identical prices. In financial markets the law of one price is thought to hold almost exactly, and is the basis for much of financial economic theory. We present evidence on several examples of violations of this law, including closed-end country funds, twin shares, dual class shares, and corporate spinoffs. We analyze the causes of these violations, and show they all stem from some limits on the extent to which rational arbitrageurs can intervene.

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