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Title:Are oligarchs productive? Theory and evidence PDF Logo
Authors:Gorodnichenko, Yuriy
Grygorenko, Yegor
Issue Date:2008
Series/Report no.:IZA Discussion Papers 3282
Abstract:This paper develops a partial equilibrium model to account for stylized facts about the behavior of oligarchs, politically and economically strong conglomerates in transition and developing countries. The model predicts that oligarchs are more likely than other owners to invest in productivity enhancing projects and to vertically integrate firms to capture the gains from possible synergies and, thus, oligarchs can be productive. Using a unique dataset comprising almost 2,000 Ukrainian open joint stock companies, the paper tests empirical implications of the model. In contrast to commonly held views, econometric results suggest that, after controlling for endogeneity of ownership, oligarchs can improve the performance of the firms they own relative to other firms.
Subjects:Oligarch
transition
firm performance
property rights
treatment effect
JEL:C21
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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