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Corporate Governance Quality

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Author Info

  • Kenichi Ueda
  • Gianni De Nicoló
  • Luc Laeven

Abstract

This paper constructs a composite index of corporate governance quality, documents its evolution from 1994 through 2003 in selected emerging and developed economies, and assesses its impact on aggregate and corporate growth and productivity. Our investigation yields three main findings. First, corporate governance quality in most countries has overall improved, although to varying degrees and with a few notable exceptions. Second, the data exhibit cross-country convergence in corporate governance quality with countries that score poorly initially catching up with countries with high corporate governance scores. Third, the impact of improvements in corporate governance quality on traditional measures of real economic activity-GDP growth, productivity growth, and the ratio of investment to GDP- is positive, significant, and quantitatively relevant, and the growth effect is particularly pronounced for industries that are most dependent on external finance.

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Bibliographic Info

Paper provided by International Monetary Fund in its series IMF Working Papers with number 06/293.

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Length: 41
Date of creation: 01 Dec 2006
Date of revision:
Handle: RePEc:imf:imfwpa:06/293

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Related research

Keywords: Economic growth; Productivity; Gross domestic product; shareholders; corporate governance reform; shareholder; shareholders ? rights; stakeholders; shareholder rights; corporate governance; good corporate governance; corporate finance; minority shareholders; corporate governance arrangements; shareholder meeting; extraordinary shareholder; corporate growth;

This paper has been announced in the following NEP Reports:

References

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  1. Becht, Marco & Bolton, Patrick & Roell, Ailsa, 2003. "Corporate governance and control," Handbook of the Economics of Finance, in: G.M. Constantinides & M. Harris & R. M. Stulz (ed.), Handbook of the Economics of Finance, edition 1, volume 1, chapter 1, pages 1-109 Elsevier.
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Citations

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Cited by:
  1. Claessens, Stijn & Ueda, Kenichi & Yafeh, Yishay, 2010. "Financial Frictions, Investment, and Institutions," CEPR Discussion Papers 8170, C.E.P.R. Discussion Papers.
  2. Hui Tong & Shang-Jin Wei, 2011. "Does Trade Globalization Induce or Inhibit Corporate Transparency? Unbundling the Growth Potential and Product Market Competition Channels," NBER Working Papers 17631, National Bureau of Economic Research, Inc.
  3. Fernandes, Nuno & Giannetti, Mariassunta, 2013. "On the fortunes of stock exchanges and their reversals: evidence from foreign listings," Working Paper Series 1585, European Central Bank.
  4. Kenichi Ueda & Stijn Claessens, 2008. "Banks and Labor As Stakeholders," IMF Working Papers 08/229, International Monetary Fund.

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