I have worked for BI since 2006. I joined BI after graduating from Indiana University Finance Department. In past, I have worked on a consulting project with SEC, as a sales manager, hotel manager, and accountant.
Research areas My interests are in Corporate Governance, Corporate Finance, and Portfolio Management. Under portfolio management, I am interested in strategy and performance attribution and information processing in mutual fund and institutional money management complexes. I am particularly interested in corporate finance and governance issues of family firms. I work on projects that examine issues such as the resolution of agency issues in private firms via dividend policy and the link between individual liquidity needs and activities in firms owned by these individuals. My interests include shocks generated by wealth tax changes.
Teaching areas
I have taught Applied Valuation, CFA Institute Reseach Challenge course, Managerial Accounting (MBA), Investment (undergraduate), Market Microstructure (undergraduate), International Finance (undergraduate, graduate, MBA, excecutive MBA), Basic Financial Management (undergraduate), Financial Intermediation and Banking (graduate). I am interested in integrating case-based teaching in otherwise regular courses.
We examine the emergence, succession, and performance of the initial cohort of family firms in Latvia. Latvia offers a natural setting to examine succession challenges faced by first-generation firms because a majority of these firms were established shortly after the country regained independence in the early 1990s. Our findings indicate that in 44% of sample firms the founding family did not have a majority stake at incorporation, but accumulated a majority stake over the first few years (1991–1999). It takes seven years for the average family ownership stake to exceed 75% and 23 years for firms with second-generation owners to reach 16% of the sample. Notably, approximately 80% of the sample firms are still majority-owned and managed by their founders. In line with previous research, we find that family firms outperform nonfamily firms by 3.1
We find that potential conflicts between majority and minority shareholders strongly influence how dividends respond to taxes. When the controlling shareholder has a smaller stake, the incentives to extract private benefits are stronger – a shareholder conflict that can be mitigated by dividend payout. We study a large and clean regulatory shock in Norway that increases the dividend tax rate for all individuals from 0% to 28%. We find that dividends drop less the higher the potential shareholder conflict, suggesting that dividend policy trades off tax and agency considerations. The average payout ratio falls by 30 percentage points when the conflict potential is low, but by only 18 points when it is high. These lower dividends cannot be explained by higher salaries to shareholders or diverse liquidity needs. We also observe a strong increase in indirect ownership of high-conflict firms through tax-exempt holding companies and suggest policy implications for intercorporate dividend taxation.
We examine how dividend policy is used to mitigate potential conflicts of interest between majority and minority shareholders in private Norwegian firms. The average payout is 50% higher if the majority shareholder’s equity stake is 55% (high conflict potential) rather than 95% (low conflict potential). Such minority-friendly payout is also associated with higher subsequent minority shareholder investment. These results suggest that controlling shareholders voluntarily use dividends to reduce agency conflicts and build trust, rather than opportunistically preferring private benefits to dividends. We show that our results are unlikely to arise from liquidity or signaling motives.
Berzins, Janis & Bøhren, Øyvind (2013)
Norske familiebedrifter - Omfang, eierstyring og lønnsomhet
Praktisk økonomi & finans, 29(3), s. 57- 75.
Berzins, Janis; Trzcinka, Charles & Liu, Crocker (2013)