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Corporate Governance, Crony capitalism and Economic Crisis: Should the US Business Model replace the Asian Way of 'Doing Business'?

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  • Ajit Singh
  • Ann Zammit

Abstract

This paper considers the Greenspan/Summers/IMF (GSI) argument that the Asian way of doing business was the deep cause of the Asian crisis. The IMF reform programme for the crisis-affected Asian countries suggested they should abandon the Asian business model and adopt the US corporate model. The main findings are: a) contrary to GSI doctrine, poor corporate governance and lack of competition are not common characteristics of the Asian business model; b) that the stock-market based US business model has severe limitations for developing country corporations, not least because of imperfect share prices and the imperfect market for corporate control.

Suggested Citation

  • Ajit Singh & Ann Zammit, 2006. "Corporate Governance, Crony capitalism and Economic Crisis: Should the US Business Model replace the Asian Way of 'Doing Business'?," Working Papers wp329, Centre for Business Research, University of Cambridge.
  • Handle: RePEc:cbr:cbrwps:wp329 Note: PRO-2
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    References listed on IDEAS

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    Cited by:

    1. Andreas Högberg, 2011. "Family Ownership and Regional Economic Development in Asia and Europe," ERSA conference papers ersa10p940, European Regional Science Association.
    2. Alessandro Mechelli & Riccardo Cimini, 2014. "The value relevance of earnings and book value across the EU. A comparative Analysis," FINANCIAL REPORTING, FrancoAngeli Editore, vol. 2014(2-3-4), pages 83-113.

    More about this item

    Keywords

    Asian and US corporate models; stock markets; Asian crisis;

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • G3 - Financial Economics - - Corporate Finance and Governance
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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