The Ownership Complaint Gap: Mutual versus Stock Intermediaries

Jiang CHENG, Wenlan QIAN, David M. REEB

Research output: Journal PublicationsJournal Article (refereed)


We document a substantial customer complaint gap between stock and mutual financial firms. To assess whether this 21% per year complaint gap stems from complaint-prone customers in stock insurers, we examine state-adjudicated complaint success. To further delineate between customer selection or treatment explanations, we exploit within insurer complaints around random claims (natural disasters) and attention shocks (media scrutiny). Further tests reveal the complaint gap widens with greater competition, near insolvency thresholds, and with more price regulation. Overall, the results are inconsistent with the hypothesis that mutual financial firms exhibit low customer satisfaction, suggesting customers find this a beneficial organizational structure.
Original languageEnglish
Number of pages31
JournalJournal of Financial and Quantitative Analysis
Early online date24 Jul 2019
Publication statusE-pub ahead of print - 24 Jul 2019


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