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East Asian Corporations. Heroes or Villains?

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Author Info
Claessens, S.
Djankov, S.
Lang, L.H.P.

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Abstract

East Asian corporations differ from their counterparts in other countries in important ways. Before the recent financial crisis these differences were viewed as one of the reasons for the success of East Asian economies. The crisis altered that view, and many scholars now argue that the weak corporate governance and financing structures of East Asian corporations are partly to blame for the recent crisis. This paper reviews several features of East Asian corporations, showing that they have high leverage and concentrated ownership, are typically affiliated with business groups, and operate in multiple industries. These characteristics affected the performance of corporations prior to the crisis as well as their ability to deal with its aftermath. Each economy's level of development also affected how these characteristics interacted with firm performance and valuation. Finally, the concentration of ownership in the hands of a few large families may have influenced economies' institutional development.

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Publisher Info
Paper provided by World Bank in its series World Bank - Discussion Papers with number 409.

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Length: 33 pages
Date of creation: 1999
Date of revision:
Handle: RePEc:fth:wobadi:409

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Related research
Keywords: INDUSTRIAL ORGANISATIONS ; CORPORATIONS;

Find related papers by JEL classification:
L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General

Cited by:
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  1. Claessens, Stijn & Djankov, Simeon & Xu, Lixin Colin, 2000. "Corporate Performance in the East Asian Financial Crisis," World Bank Research Observer, Oxford University Press, vol. 15(1), pages 23-46, February. [Downloadable!]
  2. James E. Anderson & Leslie Young, 2000. "Trade Implies Law: The Power of the Weak," Boston College Working Papers in Economics 475, Boston College Department of Economics. [Downloadable!]
    Other versions:
  3. 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)
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This page was last updated on 2009-11-20.


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