The Impact of Ownership Structure and Control Mechanisms on Transaction Costs: An Empirical Study of Firms Listed on the Euronext Paris Stock Exchange for the Period between 2004 and 2007

Alexis Guyot (1)

1 Audencia Recherche

This article examines the impact of control structures on transaction costs of firms listed on the Euronext Paris Stock Exchange for the period between 2004 and 2007. The results of our tests show that the concentration of control, especially by financial institutions, raises stock transaction costs. We also demonstrate how the issuing of shares with double voting rights leads to an increase in transaction costs. In that case, the cost of liquidity increases in line with the extent of the gap between ownership and control. Finally, with the exception of the second largest core shareholder, who may be perceived as adding additionnal control by investors, transaction costs increase in line with the degree of control exercised by second-tier large shareholders.

Mots clés: government ownership; government corporations; stock exchanges; transaction costs; inventory control

Domaines: Microstructure des marchés [q-fin.TR]

Alexis Guyot. The Impact of Ownership Structure and Control Mechanisms on Transaction Costs: An Empirical Study of Firms Listed on the Euronext Paris Stock Exchange for the Period between 2004 and 2007. Bankers Markets & Investors : an academic & professional review, 2010, 108, pp.4-20. ⟨hal-00841050⟩