The Impact of Ownership Structure on Corporate Performance in Transitional Economies
Author:Slobodan Čerović, Nemanja Stanišić, Tijana Radojević and Nikica Radović
JEL:M210,G32, L25.
DOI:
Keywords:ownership structure, profitability, agency problem, linear mixed models
Abstract:
The relationship between ownership structure and corporate performance might be
remarkably strong and in formative within transition economies. In this research, we
explore this relationship, referring to the example of the Republic of Serbia. For that
purpose, appropriate linear models have been fitted to the panel dataset compiled from
financial reports of 2101 non-financial companies actively operating during the period
2008-2013. The results indicate that, after controlling for size effect, companies
characterised by state, dispersed or/and foreign ownership have significantly lower
profitability in comparison to their counterparts. We would argue that an intensified agency
problem and lack of entrepreneurial spirit might be the root of the profitability problem.