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Abstract
A recently published paper by Gugler and Weigand (Citation2003) addresses the problem of the endogeneity of ownership, but an unresolved question remains. Where does this endogeneity come from? It is shown that the main source of endogeneity is the simultaneity between ownership and value.
Acknowledgements
We thank the research agency of the Spanish Government, DGI (Project BEC2001-1851) and the Junta de Castilla y Leon (Project SA 033/02) for financial support.
Notes
The estimation results will be provided by the authors upon request.
We find, however, no conclusive explanation for this lack of significance. In addition to the simultaneity between insider ownership and value, the fact that ownership concentration significantly contributes to the explanation of insider ownership levels, as shown in Chen and Steiner (1999), may explain this result.