Innovation: The Bright Side of Common Ownership?
30 Jan 2024
13:00 -14:15
Times are shown in local time.
Open to: All
Room W4.05 (Cambridge Judge Business School)
Trumpington St
Cambridge
CB2 1AG
United Kingdom
Join our Finance seminar, in collaboration with the Cambridge Corporate Governance Network
Speaker: Professor Mireia Giné, IESE Business School
About the seminar topic
Firms have inefficiently low incentives to innovate when other firms benefit from their inventions and the innovating firm therefore does not capture the full surplus of its innovations. We show that common ownership of firms mitigates this impediment to corporate innovation. By contrast, without technological spillovers, innovation has the effect of stealing market share from rivals; in that case, more common ownership reduces innovation. Empirically, the association between common ownership and innovation inputs and outputs decreases with product market proximity and increases with technology proximity.
The sign and magnitude of the overall relationship between common ownership and corporate innovation thus varies considerably across the universe of firms depending on their relative proximity in technology and product market space. These results persist if we use only variation from BlackRock’s acquisition of BGI. Our results inform the debate about the welfare effects of increasing common ownership among US corporations.
Speaker bio
Mireia is a Full Professor at the Department of Financial Management at IESE. Her research focuses on corporate governance, mergers and acquisitions, and AI adoption. She has published in the Journal of Political Economy, Journal of Finance, Journal of Financial Economics, Review of Finance, and Harvard Business Review among other academic journals, as well as in various media (Financial Times, The Economist, Bloomberg, BBC).
Mireia is an independent board member at Banc Sabadell and the Chair of the Remuneration Committee. She serves as well on the board of the consumer finance unit of the bank.
Register
No registration required. If you have any questions about this seminar, please email Luke Slater.