Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/182394 
Year of Publication: 
2018
Series/Report no.: 
University of Tübingen Working Papers in Economics and Finance No. 109
Publisher: 
University of Tübingen, Faculty of Economics and Social Sciences, Tübingen
Abstract: 
We study an asymmetric triopoly in a heterogeneous product market where quantity decisions are delegated to managers. The two biggest firms are commonly owned by shareholders such as index funds while the smallest firm is owned by independent shareholders. Under such a common holding owner structure, the owners have an incentive to coordinate when designing their manager compensation schemes. This coordination leads to a reallocation of production and induces a redistribution of pro profits. The trade volume in the market is reduced so that shareholder coordination is detrimental to consumer surplus as well as welfare.
Subjects: 
common holdings
index funds
shareholder coordination
manager compensation
JEL: 
G32
L22
M52
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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