Abstract
We present a model that shows that strong shareholder rights have a greater impact on value for firms that operate in less opaque information environments. We model shareholder rights as an option at the disposal of shareholders to stop projects chosen by a manager, and show that the value of this veto increases with the precision of a signal the shareholder receives about project type. The model has implications for design of regulatory policy aimed at strengthening shareholder rights.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: 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.