IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/16316.html
   My bibliography  Save this paper

Ethnic Investing and the Value of Firms

Author

Listed:
  • Hjort, Jonas

Abstract

We study ethnic investing, using transaction data from Kenya’s stock exchange and CEO/board turnover. We show that a given investor invests more in a given firm when the firm is run by coethnics and earns lower risk-adjusted returns on such investments. We then model and empirically test for the aggregate impact of (i) the implied taste- or psychology-driven investor discrimination and (ii) counteracting demand- and supply-side forces. Our estimates imply that listed Kenyan firms could collectively be worth 37 percent more—with minority-run firms benefitting the most—if the neutral proportion of active investors increased from 4.2 to 50 percent.

Suggested Citation

  • Hjort, Jonas, 2021. "Ethnic Investing and the Value of Firms," CEPR Discussion Papers 16316, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:16316
    as

    Download full text from publisher

    File URL: https://cepr.org/publications/DP16316
    Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:16316. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://www.cepr.org .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.