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Globalization and Similarities in Corporate Governance: A Cross-Country Analysis

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Author Info
Tarun Khanna (Harvard Business School)
Joe Kogan (Esquela de Administración, Pontifica Universidad, Católica de Chile, and Lehman Brothers)
Krishna Palepu (Harvard Business School)
Abstract

Some scholars have argued that globalization should pressure firms to adopt the most efficient form of corporate governance; others maintain that such convergence will not occur because of path dependence. We find robust evidence that economically interdependent countries have similar corporate governance laws protecting stakeholders. In contrast, we find virtually no relationship between corporate governance practices and globalization in a battery of estimations at the country, industry, and firm levels. We conclude that globalization may have induced the adoption of some common corporate governance standards but these standards may not have been implemented. Copyright (c) 2006 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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File URL: http://www.mitpressjournals.org/doi/pdfplus/10.1162/rest.2006.88.1.69
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Article provided by MIT Press in its journal Review of Economics and Statistics.

Volume (Year): 88 (2006)
Issue (Month): 1 (March)
Pages: 69-90
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Handle: RePEc:tpr:restat:v:88:y:2006:i:1:p:69-90

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  1. Yener Altunbaş & Alper Kara & Adrian van Rixtel, 2007. "Corporate governance and corporate ownership: The investment behaviour of Japanese institutional investors," Banco de España Occasional Papers 0703, Banco de España. [Downloadable!]
  2. Durnev, Art & Fauver, Larry, 2008. "Stealing from Thieves: Firm Governance and Performance when States are Predatory," CEI Working Paper Series 2008-12, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University. [Downloadable!]
  3. Chhaochharia, Vidhi & Laeven, Luc, 2007. "The Invisible Hand in Corporate Governance," CEPR Discussion Papers 6256, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  4. Michael Carney, 2008. "The many futures of Asian business groups," Asia Pacific Journal of Management, Springer, vol. 25(4), pages 595-613, December. [Downloadable!] (restricted)
  5. Bonardi, Jean-Philippe & Urbiztondo, Santiago & Quelin, Bertrand, 2008. "The political economy of international regulatory convergence in public utilities," MPRA Paper 14435, University Library of Munich, Germany. [Downloadable!]
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