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metadata language: English

Voting Rights, Private Benefits, and Takeovers

Version
v0
Resource Type
Dataset : survey data
Creator
  • Schmid, Frank A. (Federal Reserve Bank of St. Louis)
Other Title
  • Archival Version (Subtitle)
Publication Date
2002-03-08
Language
English
Free Keywords
corporate mergers; corporate takeovers; corporations; investors
Description
  • Abstract

    This article analyzes the effects that institutional design of a firm has on the allocation of control over the firm's assets. The efficient allocation of control is a necessary condition for the optimal allocation of resources. Dynamic efficiency in resource allocation presupposes that control over firms will change hands when a given allocation becomes suboptimal. Typically, changes in control are brought about through (successful) tender offers or block trades. With regard to takeovers, a firm may have two types of value to consider: First, there is the public value of the firm, which is the market value of the firm's securities. Second, there may be a private value of the firm. The private value is the benefit an investor enjoys from exercising control over the firm. Private control benefits are most significant for entrepreneurial start-ups, for established family-owned businesses, and for organizations in which personal investors also pursue non-pecuniary goals, such as media groups or professional sports organizations. Of the legal arrangements identified in the finance literature, the most significant for wealth maximization in takeovers are the one share-one vote principle, majority rule, and mandatory tender offers. The authors analyze the implications of these three institutional arrangements in a simple textbook takeover model. The model helps in understanding the optimal design of a legal environment in which the market for corporate control promotes efficient allocation of capital.
  • Table of Contents

    Datasets:

    • DS1: Dataset
Geographic Coverage
  • United States
Collection Mode
  • (1) The file submitted is a data file, 0201fsd.txt. (2) These data are part of ICPSR's Publication-Related Archive and are distributed exactly as they arrived from the data depositor. ICPSR has not checked or processed this material. Users should consult the investigator if further information is desired.

Availability
Delivery
This version of the study is no longer available on the web. If you need to acquire this version of the data, you have to contact ICPSR User Support (help@icpsr.umich.edu).
Alternative Identifiers
  • 1252 (Type: ICPSR Study Number)
Relations
  • Is previous version of
    DOI: 10.3886/ICPSR01252.v1

Update Metadata: 2015-08-05 | Issue Number: 6 | Registration Date: 2015-06-15

Schmid, Frank A. (2002): Voting Rights, Private Benefits, and Takeovers. Archival Version. Version: v0. ICPSR - Interuniversity Consortium for Political and Social Research. Dataset. https://doi.org/10.3886/ICPSR01252