TY  - JOUR
AU  - Helwege,Jean
AU  - Pirinsky,Christo
AU  - Stulz,René M.
TI  - Why Do Firms Become Widely Held? An Analysis of the ynamics of Corporate Ownership
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 11505
PY  - 2005
Y2  - August 2005
UR  - http://www.nber.org/papers/w11505
L1  - http://www.nber.org/papers/w11505.pdf
N1  - Author contact info:
Jean Helwege
University of South Carolina
1705 College St
Columbia, SC 29208
Tel: 803-777-4926
E-Mail: jean.helwege@moore.sc.edu

Christo Pirinsky
Department of Finance
George Washington University
2201 G St. NW, FH 507
Washington, DC 20052
Tel: 202.994.2377
Fax: 202.994.5014
E-Mail: pirinsky@gwu.edu

Rene M. Stulz
The Ohio State University
Fisher College of Business
806A Fisher Hall
Columbus, OH 43210-1144
Tel: 614/292-1970
Fax: 614/292-2359
E-Mail: stulz_1@cob.osu.edu
AB  - We consider IPO firms from 1970 to 2001 and examine the evolution of their insider ownership over time to understand better why and how U.S. firms that become widely held do so. In our sample, a majority of firms has insider ownership below 20% after ten years. We find that a firm's stock market performance and trading play an extremely important role in its insider ownership dynamics. Firms that experience large decreases in insider ownership and/or become widely held are firms with high valuations, good recent stock market performance, and liquid markets for their stocks. In contrast and surprisingly, variables suggested by agency theory have limited success in explaining the evolution of insider ownership.
ER  -