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The Case For Doing Nothing About Institutional Investors' Common Ownership Of Small Stakes In Competing Firms, Thomas A. Lambert, Michael E. Sykuta
The Case For Doing Nothing About Institutional Investors' Common Ownership Of Small Stakes In Competing Firms, Thomas A. Lambert, Michael E. Sykuta
Faculty Publications
Recent empirical research purports to demonstrate that institutional investors' "common ownership " of small stakes in competing firms causes those firms to compete less aggressively, injuring consumers. A number of prominent antitrust scholars have cited this research as grounds for limiting the degree to which institutional investors may hold stakes in multiple firms that compete in any concentrated market. This Article contends that the purported competitive problem is overblown and that the proposed solutions would reduce overall social welfare. With respect to the purported problem, we show that the theory of anti-competitive harm from institutional investors' common ownership is implausible …