Do dual holders enhance or hinder managerial efficiency?

Abstract

This study examines the influence of dual ownership on managerial efficiency using panel data from a dataset of U.S. firms spanning 1996 to 2017. Our findings indicate that dual ownership negatively affects managerial efficiency, demonstrating diminishing productivity in resource utilization when dual ownership is present or increases. Cross-sectional analyses suggest that the adverse effect of dual holders on managerial efficiency is more pronounced in dual-held firms with weaker corporate governance and greater financial constraints. Additional analyses, including propensity score matching, change specifications, Lewbel's instrumental variable approach, and alternative measures of managerial efficiency, corroborate our findings.