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Equity Markets with Controlling Shareholders

Author

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  • Sinha, Sidharth

Abstract

In early 2008 the Finance Ministry issued a consultation paper on “Requirement of Public Holding for Listing”. The Finance Minister also declared in his 2009-10 budget speech that the threshold for non-promoter public shareholding for all listed companies would be raised in a phased manner. This paper discusses the cross-country research on concentrated share ownership and household participation in equity markets. The paper argues that instead of ‘forcing’ controlling shareholders to dilute their positions the government can achieve its objective more effectively by enhancing minority investor protection in the short run and creating more owners by improving the “Ease of doing business” in the long run.

Suggested Citation

  • Sinha, Sidharth, 2011. "Equity Markets with Controlling Shareholders," IIMA Working Papers WP2011-04-02, Indian Institute of Management Ahmedabad, Research and Publication Department.
    • Handle: RePEc:iim:iimawp:10563
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    File URL: https://www.iima.ac.in/sites/default/files/rnpfiles/8949079892011-04-02.pdf
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    References listed on IDEAS

    as
    1. Luigi Guiso & Michael Haliassos & Tullio Jappelli, 2003. "Household stockholding in Europe: where do we stand and where do we go? [‘Limited market participation and volatility of assets prices’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 18(36), pages 123-170.
    2. Tarun Khanna & Krishna Palepu, 2005. "The Evolution of Concentrated Ownership in India: Broad Patterns and a History of the Indian Software Industry," NBER Chapters, in: A History of Corporate Governance around the World: Family Business Groups to Professional Managers, pages 283-324, National Bureau of Economic Research, Inc.
    3. Luigi Guiso & Michael Haliassos & Tullio Jappelli (ed.), 2003. "Stockholding in Europe," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-50267-3.
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