NETWORKS REVEAL CONCENTRATED OWNERSHIP OF CORPORATIONS

[Joanne98]

http://www.sciencenews.org/view/generic/id/40886
NETWORKS REVEAL CONCENTRATED OWNERSHIP OF
CORPORATIONS
Analysis of stock markets in 48 countries finds backbones of
control
Researchers have made the first maps of corporate stock ownership for the stock
markets of a large number of countries, 48 in all. The new network analysis
technique reveals “backbones” in these ownership networks: big players that
together own a controlling stake in more than 80 percent of the companies in the
markets.
In these network diagrams, nodes represent either a company with publicly owned
stock or a shareholder. Links between the nodes show which shareholders hold
stock in which companies. Because many publicly owned companies also hold
shares in other companies, many nodes have both “owner” and “ownee” links.
Plotting all these connections creates a map of the ownership structure of a stock
market.
Unlike the approach used in the new study, simpler network analyses can’t reveal
these backbones of ownership because the market values of companies being
traded aren’t taken into account. The new study, published online February 5 at
arXiv.org, adds these market values. It also includes a way to account for indirect
ownership, such as when a company owns stock in a second company that, in
turn, owns stock in a third company.
“If you do a network analysis, you can see things that you couldn’t see otherwise,”
says Stefano Battiston, coauthor of the study and a physicist at the Swiss Federal
Institute of Technology in Zurich who studies complex socioeconomic networks.
“Although from an individual point of view corporations are widely held, from a
global point of view ownership is more highly concentrated.”
The resulting networks, which are based on a snapshot of market data from early
2007, show that concentration of ownership in these markets varies from country
to country. The United States and United Kingdom had the highest concentration
of ownership, while ownership was less concentrated in European and Asian
countries. Some companies held so much stock at the time that they constituted
part of the backbones of many countries. The top ten such companies were:
1. The Capital Group Companies (U.S.)
2. Fidelity Management & Research (U.S.)
3. Barclays PLC (U.K.)
4. Franklin Resources (U.S.)
5. AXA (France)

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http://j-node.homeip.net/wfb/jbg%20archive/media/sciencenews.pdf

[fasttense]

1. I've always looked at the DJIA as a gage on if the uber wealthy were happy or not.

When the DJIA is up, the uber rich are happy.

When the DJIA is down the uber rich are unhappy.

I like it when it's down.

[Joanne98]

2. Me too. lol