The Dynamic Trade-Off of Dual-Class Shares

[2608.25972] The Dynamic Trade-Off of Dual-Class Shares Skip to main content Search Submit Donate Log in Economics > General Economics arXiv:2608.25972 (econ) [Submitted on 26 Aug 2026 ( v1 ), last revised 27 Aug 2026 (this version, v2)] Title: The Dynamic Trade-Off of Dual-Class Shares Authors: Hyunseob Kim , Doron Levit , Roni Michaely View PDF HTML (experimental) Abstract: Dual-class shares allocate control to founders whose firm-specific investments drive firm value but separate control from ownership, raising agency costs. We analyze this trade-off dynamically. Using new data on US dual-class firms spanning 52 years and difference-in-differences designs, we show that valuations rise following dual-class recapitalizations but decline over time, whereas innovative output increases persistently. These effects are concentrated in industries with greater firm-specific investments. We find corresponding results for stock unifications. Investment by mature dual-class firms is less sensitive to opportunities and voting premia increase with maturity. Our results support dynamic treatment effects and yield new policy implications. Subjects: General Economics (econ.GN) Cite as: arXiv:2608.25972 [econ.GN] (or arXiv:2608.25972v2 [econ.GN] for this version) https://doi.org/10.48550/arXiv.2608.25972 Focus to learn more arXiv-issued DOI via DataCite Submission history From: Hyunseob Kim [ view email ] [v1] Wed, 26 Aug 2026 16:30:03 UTC (2,453 KB) [v2] Thu, 27 Aug 2026 22:06:09 UTC (452 KB) Full-text links: Access Paper: View PDF HTML (experimental) TeX Source view license Current browse context: econ.GN < prev | next > new | recent | 2026-08 Change to browse by: econ q-fin q-fin.EC References & Citations SciX Google Scholar Semantic Scholar export BibTeX citation Bookmark Bibliographic Tools Bibliographic and Citation Tools Bibliographic Explorer Toggle Bibliographic Explorer ( What is the Explorer? ) Connected Papers Toggle Connected Papers ( What is Connected Papers? ) Litmaps Toggle Litmaps ( What is Litmaps? ) scite.ai Toggle scite Smart Citations ( What are Smart Citations? ) Code, Data, Media Code, Data and Media Associated with this Article alphaXiv Toggle alphaXiv ( What is alphaXiv? ) Links to Code Toggle CatalyzeX Code Finder for Papers ( What is CatalyzeX? ) DagsHub Toggle DagsHub ( What is DagsHub? ) GotitPub Toggle Gotit.pub ( What is GotitPub? ) Huggingface Toggle Hugging Face ( What is Huggingface? ) ScienceCast Toggle ScienceCast ( What is ScienceCast? ) Demos Demos Replicate Toggle Replicate ( What is Replicate? ) Spaces Toggle Hugging Face Spaces ( What is Spaces? ) Spaces Toggle TXYZ.AI ( What is TXYZ.AI? ) Related Papers Recommenders and Search Tools Link to Influence Flower Influence Flower ( What are Influence Flowers? ) Core recommender toggle CORE Recommender ( What is CORE? ) Author Venue Institution Topic About arXivLabs arXivLabs: experimental projects with community collaborators arXivLabs is a framework that allows collaborators to develop and share new arXiv features directly on our website. Both individuals and organizations that work with arXivLabs have embraced and accepted our values of openness, community, excellence, and user data privacy. arXiv is committed to these values and only works with partners that adhere to them. Have an idea for a project that will add value for arXiv's community? Learn more about arXivLabs . Which authors of this paper are endorsers? | Disable MathJax ( What is MathJax? ) We gratefully acknowledge support from our major funders , member institutions , and all contributors. About · Help · Contact · Subscribe · Copyright · Privacy · Accessibility · Operational Status (opens in new tab)

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