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Economic reforms, corporate governance and privatization method as determinants in performance changes of new privatized firms: the case of MENA countries

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  • Oussama Nheri

Abstract

This paper aims to provide the determinants of how privatization works in some selected Middle East North Africa countries. Using a sample of 75 new privatized firms we examine the performance changes in countries namely Egypt, Morocco, Tunisia and Turkey. We document a significant increase in profitability, efficiency and output as well as a decrease in leverage. We also identify that these improvements vary with economic reforms and environment, effectiveness of corporate governance and the privatization method used. In particular, financial liberalization and control relinquishment by the government are associated with higher efficiency and output. Furthermore, foreign participation and the use of share issue privatization as divestment method appear to have a positive impact on efficiency and output changes. Additionally, the use of private sales is related to a significant decrease in leverage. Finally our results highlight the importance of economic reforms, corporate governance and the choice of privatization method in explaining the post privatization changes in performance. Copyright The Author(s) 2014

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  • Oussama Nheri, 2014. "Economic reforms, corporate governance and privatization method as determinants in performance changes of new privatized firms: the case of MENA countries," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 18(1), pages 95-127, February.
    • Handle: RePEc:kap:jmgtgv:v:18:y:2014:i:1:p:95-127
    DOI: 10.1007/s10997-012-9222-9
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    Cited by:

    1. Rihem Braham & Christian Peretti & Lotfi Belkacem, 2019. "Do political connections affect bank leverage? Evidence from some Middle Eastern and North African countries," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 23(4), pages 989-1006, December.
    2. Ben-Hassoun, Amira & Aloui, Chaker & Ben-Nasr, Hamdi, 2018. "Demand for audit quality in newly privatized firms in MENA region: Role of internal corporate governance mechanisms audit," Research in International Business and Finance, Elsevier, vol. 45(C), pages 334-348.

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    More about this item

    Keywords

    Corporate governance; Privatization method; Economic reforms; MENA countries; Performance; G32; G38;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation

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