Data and Code for "Diversification, Common Ownership, and Strategic Incentives"

We investigate how changes in firms’ own-ership structures affect their strategic in-centives in product markets. We show thatfirms’ common ownership incentives, i.e.,the profit loads managers should place oncompeting firms, increase if the holdings ofmore diversified investors’ increase relativeto those of less diversified investors.<br>We illustrate the above through twoindustry examples, department stores andpublishers. We show graphically that, in thesetwo industries when the holdings of the pas-sive investors increase, then common own-ership incentives increase. On the contrarywhen the holdings of the active investors in-crease, then common ownership incentivesdecrease.<br>