【报告主题】Common Ownership and Peer Selection in Relative Performance Evaluation
【主讲嘉宾】宫国瑾，康涅狄格大学会计学教授
【报告时间】2023年11月28日 9:30
【报告地点】线上
【内容提要】
Institutional investors often simultaneously hold large stakes in same-industry firms (hereafter common ownership). This study intends to explore the implications of common ownership for incentive contracting by examining the relation between common ownership and peer selection in relative performance evaluation (RPE). Theory posits that RPE may motivate managers to sabotage or cooperate with selected RPE peers. Consistent with a cooperative incentive, we find that an RPE firm with greater common ownership is more likely to select commonly-owned peers as RPE peers. This positive relation is stronger (weaker) when the RPE firm and a peer firm are strategic complements (substitutes). Path analyses suggest that common ownership, through influencing RPE peer selection, fosters cooperative relationship between the focal firm and its RPE peers. Collectively, our evidence highlights the importance of incentive contracting as a potential mechanism through which common ownership affects the cooperation and competition in the product market.