Ownership structure and cost of equity capital: Tunisian evidence

Dakhlaoui, Mejda; Gana, Marjène Rabah

doi:10.1504/ijbge.2020.104702

Cited by 11 publications

(16 citation statements)

References 68 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…In this study, the multivariate regression model will be applied to test the hypotheses using the methodology used by Bozec et al (2014), Afkhami Rad (2014), Khan (2016), Arslan and Abidin (2019) and Dakhlaoui and Gana (2020). …”

Section: Methodsmentioning

confidence: 99%

“…Moreover, these results supported by the view that managerial ownership plays an active role in taking risks with other investors in the company’s performance and alleviating the agency’s problem (Huang et al , 2009). Moreover, other studies argue that managerial ownership is a significant positive associated with the cost of equity capital (Arslan and Abidin, 2019; Dakhlaoui and Gana, 2020). According to Khan (2016), find a positive impact on the cost of equity.…”

Section: Theoretical Literature and Hypothesis Developmentmentioning

confidence: 99%

“…The corporate governance focuses on the role of the ownership structure in mitigating conflicts among the related parties (Gillan and Starks, 2003; Huang et al , 2009; Laidroo, 2009; Ducassy and Guyot, 2017; Dakhlaoui and Gana, 2020). Jensen and Meckling (1976) note out that companies with dispersed ownership structures are likely to have a major conflict of interest between the shareholders and the manager.…”

Section: Theoretical Literature and Hypothesis Developmentmentioning

confidence: 99%

“…Many studies focused on ownership structure because it is the cornerstone of supervision and control of the company’s performance (O’Brien and Bhushan, 1990; Shleifer and Vishny, 1997; Maher and Andersson, 2002; Ducassy and Guyot, 2017; Dakhlaoui and Gana, 2020). Maher and Andersson (2002) say that one of the most striking differences between corporate governance systems in countries is the contradictions in ownership structure and control of companies.…”

Section: Introductionmentioning

confidence: 99%

See 3 more Smart Citations

The impact of ownership structure on the cost of equity in emerging markets

Faysal

Salehi

Moradi

2020

MRR

View full text Add to dashboard Cite

Purpose The purpose of this study is to cover the ownership structure as (institutional ownership and managerial ownership) influencing the cost of equity in emerging markets. Design/methodology/approach The authors applied the regression model with the fixed-effect model in the data. Data collected from listed companies in the Iraq-Iran Stock Exchange during 2012-2017. Findings The authors found a significant positive associated between institutional ownership and the cost of equity in the Iranian and Iraqi contexts. The results also reveal a significant negative associated between managerial ownership with the cost of equity in the Iranian and Iraqi contexts. This means that when managerial ownership is increased, the cost of equity will be reduced. These results support the role of inside ownership to enhance fixed performance by reducing the cost of equity. So, managerial ownership can be a substitute for all shareholders. Moreover, the results indicate a similarity in the impact of the ownership structure on the cost of equity in the Iraqi and Iranian context, this means the similar elements among west Asian countries. Research limitations/implications Financial companies such as banks and investment companies were not listed due to the difference in the nature of their work with the other sectors in the Iranian and Iraqi stock exchanges. Moreover, the authors are heavily constrained as listed companies must continue during the study period to calculate the cost of equity. Therefore, the results are difficult to generalize widely. Practical implications This international study will enable investors in, as well as local and international investors to take the appropriate investment decision-making in the capital markets in these countries (Iraq and Iran). Moreover, it contributes significantly to helping corporate governance bloggers in Iraq and Iran understand the role of the ownership structure in corporate governance. Originality/value This is the first study of the interaction between institutional ownership, managerial ownership with the cost of equity in Iraq, the study will help complete the knowledge gap with developed markets. The results are important in future research because the authors believe that it is very important for the future to look at better for percentage levels of institutional and managerial ownership in the company ownership. Although the contribution is limited, it will provide a useful guide for more papers in other west Asian countries.

show abstract

Section: Methodsmentioning

confidence: 99%

Section: Theoretical Literature and Hypothesis Developmentmentioning

confidence: 99%

Section: Theoretical Literature and Hypothesis Developmentmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

The impact of ownership structure on the cost of equity in emerging markets

Faysal

Salehi

Moradi

2020

MRR

View full text Add to dashboard Cite

show abstract

“…Different recent studies i.e. Khan (2016); Nosheen and Sajjad (2018); Arslan and Abidin (2019); Dakhlaoui and Gana (2020) used CAPM to measure the cost of equity. Therefore, we use CAPM to measure the cost of equity.…”

Section: Methodsmentioning

confidence: 99%

Impact of Corporate Political Connections on Cost of Equity: A Dynamic Panel Approach

Amanat

Hunjra

Qureshi

et al. 2021

NRJSS

View full text Add to dashboard Cite

We analyze the impact of corporate political connections on the cost of equity of non-financial firms listed at the Pakistan Stock Exchange. We extract data from the DataStream and Election Commission of Pakistan for the years 2001 to 2018. The Generalized Method of Moments is used for data analysis. This research finds that firms use political connections to enjoy a lower cost of equity capital. Further, firms with strong ties to political power obtain more benefits on financing cost as compared to non-connected firms. Besides, we also find that firms affiliated with a large business group enjoy a lower cost of equity than non-affiliated connected firms. The findings may be helpful for regulators to formulate suitable policies concerning the use of corporate political strategies and to assist unconnected and non-affiliated firms to access finance easily.

show abstract

Ownership concentration and cost of equity in Pakistan: the moderating role of disclosure and governance quality

Sajid,

Shabbir,

Safdar

2023

ARA

View full text Add to dashboard Cite

PurposeThe purpose of this study is to examine the relationship between the ownership concentration and cost of equity of firms in Pakistan context. Moreover, this study also investigates how the presence of disclosure quality and governance quality affects the relationship between ownership concentration and the cost of equity of firms.Design/methodology/approachData are collected from six non-financial sectors listed on Pakistan Stock Exchange during the period of 2015–2019. This study uses pooled ordinary least square (OLS) method to validate the proposed hypothesis in STATA.FindingsThe study found a positive and significant relationship between ownership concentration and cost of equity. The results also show that better disclosure and governance quality negatively moderates the relationship between ownership concentration and cost of equity.Practical implicationsThe findings of this study will help firm managers to implement a high level of disclosure and governance quality in firms to reduce agency problems which will further help a firm in reducing the firm's cost of equity. Furthermore, this study is valuable for practitioners regarding thinking about the process of designing ownership structures to protect minority shareholders' rights, especially in emerging markets.Originality/valueThe novelty of this study is having better disclosure quality and more board independence members helps firms with higher ownership concentration in reducing the cost of equity.

show abstract

Ownership structure and cost of equity capital: Tunisian evidence

Cited by 11 publications

References 68 publications

The impact of ownership structure on the cost of equity in emerging markets

The impact of ownership structure on the cost of equity in emerging markets

Impact of Corporate Political Connections on Cost of Equity: A Dynamic Panel Approach

Ownership concentration and cost of equity in Pakistan: the moderating role of disclosure and governance quality

Contact Info

Product

Resources

About