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Offering models to guide the book’s empirical investigation in Chapters 3, 4 and 5, Chapter 2 outlines the factors that may explain why a firm becomes an Alpha or Beta. The first set of factors includes the firm’s economic conditions when initially sold and the role of the state during privatization.


The second set of factors are those of influence after privatization, highlighting two broad categories.


The first category includes those factors internal to the firm:


- the firms’ competitiveness,

- managers’ goals, and

- the role of shareholders.


The second category includes those more, political, factors external to the firm:


- the impact of liberalization

- the roles of states in crafting M&A

- regulatory decisions on deals, and

- lobbying done by the firm.


The chapter closes by outlining the methods of analysis used in the empirical chapters to determine whether or not a firm is an Alpha or a Beta. Data used come from Forbes and the Bureau van Dijk's 

Amadeus and Zephyr databases.

Chapter 2: Explaining Why Firms May Become Alphas or Betas

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