Family-controlled pyramidal business groups were important in Canada early in the 20th century, amid rapid catch-up industrialization, but largely gave way to widely held freestanding firms by mid-century. In the 1970s and early 1980s ? an era of high inflation, financial reversal, unprecedented state intervention, and explicit emulation of continental European institutions ?
pyramidal groups abruptly regained prominence. The largest of these were politically well-connected and highly leveraged. The two largest collapsed in the early 1990s in a recession characterized by very high real interest rates. The smaller groups that survived were more vertically integrated and less diversified at the time. Widely held freestanding firms and Anglo-Saxon concepts of the role of the state soon regained predominance.
Economic nationalism has played a major, but overlooked, role in the evolution of corporate law around the world. The historical experiences of several major jurisdictions show that nationalism has left an imprint on the most important features...Read more
Using a newly assembled 50 country firm-level database spanning 19 years, we document that business group affiliated firms display substantially less pronounced fluctuations in employment than unaffiliated firms in...Read more
We examine the market reactions to earnings announcements within a parent-subsidiary ownership structure. We find that the parents’ investors react to all announcements within the group either immediately or with delay, whereas subsidiaries’...Read more
We document a new channel through which a family business group's internal capital market supports its members. Using data from 44 countries, we provide evidence that groups use internal capital to incubate difficult-to-finance investment...Read more