The impact on market outcomes of the portfolio selection of large equity investors Articles uri icon

publication date

  • March 2022

start page

  • 1

end page

  • 5

issue

  • 110296

volume

  • 212

International Standard Serial Number (ISSN)

  • 0165-1765

Electronic International Standard Serial Number (EISSN)

  • 1873-7374

abstract

  • We study the portfolio selection of large investors who own equity of the firms competing in a symmetric oligopoly. An investor's objective is to maximize the value of its portfolio accounting for the impact of its interests on the managerial incentives. We show that in a stationary equilibrium the portfolios of large investors soften competition, increasing the price markup and profits.

subjects

  • Economics

keywords

  • market power; common ownership; minority equity; portfolio selection