Marching to the Beat of Different Drummers: the Influence of Institutional Owners on Competitive Actions
نویسنده
چکیده
This research extends agency theory by exploring the influence of varied, competing, principal interests on executive actions. Findings reveal that ownership of a firm by dedicated institutional investors, who hold concentrated portfolios over time, is positively associated with firm use of strategic competitive actions. Ownership by transient institutional investors, who hold broad portfolios and make frequent trades based on current earnings, is negatively associated with strategic competitive actions and positively associated with tactical ones. Appreciable ownership of the same firm by these two classes of investors influences both strategic and tactical competitive actions. These results have broad implications for executives, investors, and policy makers.
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