The DOI matches its Crossref record; 63 of the 63 references it cites were found in a registry or an index.
The Effect of Liquidity on Governance
Abstract
This paper demonstrates a positive effect of stock liquidity on blockholder governance. Liquidity increases the likelihood of block formation. Conditional upon acquiring a stake, liquidity reduces the likelihood that the blockholder governs through voice (intervention)—as shown by the lower propensity for active investment (filing Schedule 13D) than passive investment (filing Schedule 13G). The lower frequency of activism does not reflect the abandonment of governance, but governance through the alternative channel of exit (selling one's shares): A 13G filing leads to positive announcement returns and improvements in operating performance, especially in liquid firms. Moreover, taking into account the increase in block formation, liquidity has an unconditional positive effect on voice as well as exit. We use decimalization as an exogenous shock to liquidity to identify causal effects.
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Cites
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Illiquidity and stock returns: cross-section and time-series effects
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Corporate Governance and Equity Prices
Gompers, P., Ishii, J., & Metrick, A. (2003) · The Quarterly Journal of Economics · doi:10.1162/00335530360535162 · Cited by 6,120
Mostly Harmless Econometrics: An Empiricist's Companion
Angrist, J. D., & Pischke, J.-S. (2008) · doi:10.2307/j.ctvcm4j72 · Cited by 5,051
Interaction terms in logit and probit models
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Takeover Bids, The Free-Rider Problem, and the Theory of the Corporation
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Managerial incentives and risk-taking☆
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Cited by
Behind the Scenes: The Corporate Governance Preferences of Institutional Investors
McCAHERY, J. A., SAUTNER, Z., & STARKS, L. T. (2016) · The Journal of Finance · doi:10.1111/jofi.12393 · Cited by 1,494
Does Stock Liquidity Enhance or Impede Firm Innovation?
FANG, V. W., TIAN, X., & TICE, S. (2014) · The Journal of Finance · doi:10.1111/jofi.12187 · Cited by 1,339
Self-citationDimson, E., Karakaş, O., & Li, X. (2015) · Review of Financial Studies · doi:10.1093/rfs/hhv044 · Cited by 1,242
Corporate governance and blockchains
Yermack, D. (2017) · Review of Finance · doi:10.1093/rof/rfw074 · Cited by 1,082
Passive investors, not passive owners
Appel, I. R., Gormley, T. A., & Keim, D. B. (2016) · Journal of Financial Economics · doi:10.1016/j.jfineco.2016.03.003 · Cited by 965
Metadata
- Authors
- Edmans, A., Fang, V. W., & Zur, E.
- Venue
- Review of Financial Studies
- Publisher
- Oxford University Press (OUP)
- Published
- 2013-04-10
- Volume
- 26
- Issue
- 6
- Pages
- 1443-1482
- ISSN
- 0893-9454 (ISSN-L)
- 1465-7368
- OpenAlex
- W3022527834
- Cited by
- 434
- References
- 63
- FWCI
- 76.81
- Type
- journal article
- Language
- en
- Open access
- closed
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Data sources
Bibliographic data: Semantic Scholar, OpenAlex, Crossref.
Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.
