Abstract
The relationship between management ownership and firm value is investigated in an attempt to reconcile the conflicting findings in Morck, Shleifer and Vishny (1988) and McConnell and Servaes (1990) using a sample of Fortune 500 firms and two commonly used ownership sources. The findings support the quadratic form of McConnell and Servaes, suggesting that firm value increases to a maximum at around 25 to 35 percent management ownership, then decreases for management ownership levels beyond this point.