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dc.contributor.advisorWiggins, Stevenen_US
dc.creatorGranda Kuffo, Maria L.en_US
dc.date.accessioned2010-01-16T00:11:39Z
dc.date.available2010-01-16T00:11:39Z
dc.date.created2009-05en_US
dc.date.issued2010-01-16
dc.identifier.urihttp://hdl.handle.net/1969.1/ETD-TAMU-2009-05-777
dc.description.abstractThe purpose of this research is to explore the motivation of business group firms to adopt pyramidal ownership structures. The traditional approach claims that pyramids are useful in tunneling resources to other affiliates by transferring value to firms with high cash flow rights of controlling shareholders. Using a unique dataset of 7,180 Ecuadorian firms, I analyze the transmission of profits' shocks among group firms to assess the existence and the amount of tunneling. The comprehensive ownership information allows me to identify pyramidal and horizontally owned group firms separately and better understand the nature of their ownership structure. The results provide support for the existence of tunneling in Ecuadorian business groups. About 70% of the profits of the average group firm are transferred to another affiliate, although only half of this money shows up on its books. An alternative explanation for the flow of money among group firms is the existence of internal capital markets to substitute for imperfections in the external market. I test this hypothesis by comparing the impact of cash flow availability in the investment decision of group firms with that of stand-alone firms. Group firms' cash flow to investment sensitivity appears to be only half of the value for comparable standalone firms. Moreover, group liquidity is also a determinant of the average group firm's investment, especially for pyramidal firms. The analysis sheds light on the nature of business groups in Latin America, their ownership patterns, and their resource allocation decisions.en_US
dc.format.mimetypeapplication/pdfen_US
dc.language.isoen_USen_US
dc.subjectBusiness Groupsen_US
dc.subjectPyramidal Ownershipen_US
dc.subjectInternal Capital Marketsen_US
dc.titlePyramidal Ownership in Ecuadorian Business Groupsen_US
dc.typeBooken
dc.typeThesisen
thesis.degree.departmentEconomicsen_US
thesis.degree.disciplineEconomicsen_US
thesis.degree.grantorTexas A&M Universityen_US
thesis.degree.nameDoctor of Philosophyen_US
thesis.degree.levelDoctoralen_US
dc.contributor.committeeMemberGan, Lien_US
dc.contributor.committeeMemberPuller, Stevenen_US
dc.contributor.committeeMemberTihanyi, Laszloen_US
dc.type.genreElectronic Dissertationen_US


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