School of Accountancy Faculty Publications and Presentations

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The effect of disproportionate insider control on firm performance is ambiguous. Disproportionate control may enhance insiders’ ability to expropriate perquisites; on the other hand, it may provide stability of management and reduce short-term market pressures. Using a hand-collected sample of U.S. dual-class firms, we find that disproportionate control is positively associated with accounting-based performance, but negatively associated with Tobin's Q. These results are consistent with the incentives of entrenched insiders who are interested in profitability but less beholden to capital markets.


This is the peer reviewed version of the following article: Hettler, B. and Forst, A. (2019), Disproportionate insider control and firm performance. Account Finance, 59: 1101-1130., which has been published in final form at This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions. This article may not be enhanced, enriched or otherwise transformed into a derivative work, without express permission from Wiley or by statutory rights under applicable legislation. Copyright notices must not be removed, obscured or modified. The article must be linked to Wiley’s version of record on Wiley Online Library and any embedding, framing or otherwise making available the article or pages thereof by third parties from platforms, services and websites other than Wiley Online Library must be prohibited.

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Accounting and Finance



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Accounting Commons



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