Khanna, Tarun and Thomas, Catherine 
ORCID: 0000-0002-7783-9758
(2009)
Synchronicity and firm interlocks in an emerging market.
Journal of Financial Economics, 92 (2).
pp. 182-204.
ISSN 0304-405X
Abstract
Stock price synchronicity has been attributed to poor corporate governance and a lack of firm-level transparency. This paper investigates the association between different kinds of firm interlocks, control groups, and synchronicity in Chile. A unique data set containing equity cross-holdings, common individual owners, and director interlocks is used to map out firm ties and control groups. While there is a correlation between synchronicity and share ownership and equity ties, synchronicity is more strongly correlated with interlocking directorates. The presence of share directors is associated with either reduced firm-level transparency or increased correlation in firm fundamentals—due, for example, to joint resource allocation across the firms.
| Item Type: | Article |
|---|---|
| Official URL: | http://www.journals.elsevier.com/journal-of-financ... |
| Additional Information: | © 2009 Elsevier B.V. |
| Divisions: | Management |
| Subjects: | H Social Sciences > H Social Sciences (General) |
| JEL classification: | G - Financial Economics > G1 - General Financial Markets > G14 - Information and Market Efficiency; Event Studies G - Financial Economics > G1 - General Financial Markets > G15 - International Financial Markets |
| Date Deposited: | 02 May 2013 12:24 |
| Last Modified: | 22 Apr 2024 05:12 |
| URI: | http://eprints.lse.ac.uk/id/eprint/50007 |
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