Abstract
ABSTRACT We investigate the effect of pyramidal ownership and family control on the investment-cash flow sensitivity of Brazilian firms using financial constraint indexes to classify firms. For constrained firms, we find that family control does not directly influence the investment-cash flow sensitivity, while for unconstrained firms, family control has a negative effect on investment decisions. However, the active involvement of the controlling family on the board increases the investment-cash flow of unconstrained firms, possibly aggravating agency problems. Regarding pyramidal ownership, we provide evidence that is consistent with the idea of the internal transfer of funds among firms that possess the arrangement structure.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
