Common holdings and strategic manager compensation: The case of an asymmetric triopoly

Arbeitspapier

We study an asymmetric triopoly in a heterogeneous product market where quantity decisions are delegated to managers. The two biggest firms are commonly owned by shareholders such as index funds while the smallest firm is owned by independent shareholders. Under such a common holding owner structure, the owners have an incentive to coordinate when designing their manager compensation schemes. This coordination leads to a reallocation of production and induces a redistribution of pro profits. The trade volume in the market is reduced so that shareholder coordination is detrimental to consumer surplus as well as welfare.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: University of Tübingen Working Papers in Economics and Finance ; No. 109

Classification and Topics

• Classification: Wirtschaft ; Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill ; Firm Organization and Market Structure ; Personnel Economics: Compensation and Compensation Methods and Their Effects
• Subject: common holdings ; index funds ; shareholder coordination ; manager compensation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Neus, Werner ; Stadler, Manfred
• Event: Veröffentlichung
• (who): University of Tübingen, Faculty of Economics and Social Sciences
• (where): Tübingen
• (when): 2018

Further information

• DOI: doi:10.15496/publikation-24771
• Handle: http://hdl.handle.net/10419/182394
• URN: urn:nbn:de:bsz:21-dspace-833809
• Last update: 10.03.2025, 11:44 AM CET