This paper examines the decision to go
public in the presence of large and dispersed shareholders. The decision to go
public and the shape of the ownership structure itself depend on the particular
combination of concentrated and dispersed ownership that maximizes the initial
owners’ wealth. Owners/managers and large shareholders exert costly efforts to
increase their share of the value of the public firm. The respective shares and
the listing decision are affected by the efficiency of the judiciary and law
enforcement system.
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