Synchronicity and Firm’s Network Structure

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Farajpour Bibalan, Mohammad Reza | 2018

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Type of Document: M.Sc. Thesis
Language: Farsi
Document No: 51027 (44)
University: Sharif University of Technology
Department: Management and Economics
Advisor(s): Fatemi, Farshad; Ebrahimnejad, Ali
Abstract:
There are two viewpoints about pyramid shareholding and cross ownership; first, shareholders want to increase their control over firms. Second, by pyramidal structure and cross ownership, firms internalize weakness of financial market and lack of some financial institutions. In order to identify reason(s) of this issue, we must first recognize affiliated firms and their networks. In this study, we identify firms’ networks in Iran by three definitions: shareholder network, owner network and director network. Then we estimate any correlation between returns synchronicity and being in a same network. Our results show that more than 40% of studied firms are affiliated. Also there is positive correlation between being in a network and return synchronicity. Despite of Khanna and Thomas (2009) results about Chilean firms, out results show that there is little correlation between director network with return synchronicity, and greater correlation between owner and shareholder networks with return synchronicity
Keywords:
Firm Network ; Pyramidal Shareholding ; Cross Ownership ; Return Synchronicity

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