Under pressure: Listing status and disinvestment in Japan

Abstract

We provide the first large sample comparisons of disinvestment by listed and unlisted firms using data on Japanese firms from 2001–2017. Listed firms disinvest 2.0% more than unlisted firms and their disinvestment is also more sensitive to investment opportunities. Additionally, firms that disinvest show improvements in return on assets and increases in future investment. Finally, we find that disinvestment increases with foreign ownership and falls with ownership by financial institutions.