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Selforganizology, 2019, 6(1-2): 1-12
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Article

The structure of democracy and dictatorship of firms (corporate governance) in relation to the non-competitive product market and stock abnormal returns

Hamideh Afshari
Department of Financial Management, Faculty of Economics, University of Isfahan, Isfahan, Iran

Received 20 October 2018;Accepted 25 November 2018;Published 1 June 2019
IAEES

Abstract
In this research, the relationship between the structure of democracy and dictatorship of enterprises, noncompetitive structure of markets and abnormal returns is evaluated. This assessment is conducted through the relationship between the most important criteria for this structure in the literature of research in Iran’s money market, the institutional shareholder, and product market competition with abnormal returns. This issue is carried out using the data extracted from information published by TSE-Tehran Stock Exchange and tax records of 78 firms are acquired by TSE-Tehran Stock Exchange using the Carhart model and the combined data regression. The results indicated that there is a meaningful relationship between the democracy structure of firms, percentage of institutional shareholders and abnormal returns on the non-competitive market. In other words, in a non-competitive market, the more desirable the firm’s democracy structure or business governance is, returns are also greater.

Keywords firm's democracy structure;dictatorship structure;institutional shareholders;abnormal return;product market competitive.

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