IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

The Role of Informal Institutions in Corporate Governance: Brazil, Russia, India and China Compared

  • Saul Estrin
  • Martha Prevezer

This paper argues that the role of informal institutions is central to understanding the functioning of corporate governance. We focus on the four largest emerging markets; Brazil, Russia India and China – commonly referred to as the BRIC countries. Our analysis is based on the Helmke and Levitsky framework of informal institutions and focuses on two related aspects of corporate governance: firm ownership structures and property rights; and the relationship between firms and external investors. We argue that for China and some states of India, ‘substitutive’ informal institutions, whereby informal institutions substitute for and replace ineffective formal institutions, are critical in creating corporate governance leading to positive domestic and foreign investment. In contrast, Russia is characterized by ‘competing’ informal institutions whereby various informal mechanisms of corporate governance associated with corruption and clientelism undermine the functioning of reasonably well set-out formal institutions relating to shareholder rights and relations with investors. Finally Brazil is characterized by ‘accommodating’ informal institutions which get round the effectively enforced but restrictive formal institutions and reconcile varying objectives that are held between actors in formal and informal institutions.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://webspace.qmul.ac.uk/pmartins/CGRWP31.pdf
Download Restriction: no

Paper provided by Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research in its series Working Papers with number 31.

as
in new window

Length:
Date of creation: Mar 2010
Date of revision:
Handle: RePEc:cgs:wpaper:31
Contact details of provider: Postal: +44-(0)20-7882-3167
Phone: +44-(0)20-7882-3167
Fax: 44-(0)20-7882-3615
Web page: http://www.busman.qmul.ac.uk/research/cgr/index.html
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Saul Estrin & Ruta Aidis & Tomasz Mickiewicz, 2007. "Institutions and Entrepreneurship Development in Russia: A Comparative Perspective," William Davidson Institute Working Papers Series wp867, William Davidson Institute at the University of Michigan.
  2. Campos, Nauro F. & Iootty, Mariana, 2007. "Institutional barriers to firm entry and exit: Case-study evidence from the Brazilian textiles and electronics industries," Economic Systems, Elsevier, vol. 31(4), pages 346-363, December.
  3. Daron Acemoglu & Simon Johnson & James A. Robinson, 2000. "The Colonial Origins of Comparative Development: An Empirical Investigation," NBER Working Papers 7771, National Bureau of Economic Research, Inc.
  4. Ahlstrom, David & Bruton, Garry D. & Yeh, Kuang S., 2008. "Private firms in China: Building legitimacy in an emerging economy," Journal of World Business, Elsevier, vol. 43(4), pages 385-399, October.
  5. Steven Globerman & Daniel Shapiro, 2004. "Governance Infrastructure and U.S. Foreign Direct Investment," International Finance 0404008, EconWPA.
  6. Michael Carney & Daniel Shapiro & Yao Tang, 2009. "Business Group Performance in China: Ownership and Temporal Considerations," Management and Organization Review, The International Association for Chinese Management Research, vol. 5(2), pages 167-193, 07.
  7. Tarun Khanna & Krishna Palepu, 2000. "Is Group Affiliation Profitable in Emerging Markets? An Analysis of Diversified Indian Business Groups," Journal of Finance, American Finance Association, vol. 55(2), pages 867-891, 04.
  8. J Earle & S Estrin & L Leshchenko, 1996. "Ownership Structures," CEP Discussion Papers dp0315, Centre for Economic Performance, LSE.
  9. Tarun Khanna & Krishna Palepu, 2005. "The Evolution of Concentrated Ownership in India: Broad Patterns and a History of the Indian Software Industry," NBER Chapters, in: A History of Corporate Governance around the World: Family Business Groups to Professional Managers, pages 283-324 National Bureau of Economic Research, Inc.
  10. James A. Robinson & Daron Acemoglu, 2000. "Political Losers as a Barrier to Economic Development," American Economic Review, American Economic Association, vol. 90(2), pages 126-130, May.
  11. McCarthy, Daniel J. & Puffer, Sheila M., 2003. "Corporate governance in Russia: a framework for analysis," Journal of World Business, Elsevier, vol. 38(4), pages 397-415, November.
  12. Tian, Lihui, 2007. "Does government intervention help the Chinese automobile industry? A comparison with the Chinese computer industry," Economic Systems, Elsevier, vol. 31(4), pages 364-374, December.
  13. Aidis, Ruta & Estrin, Saul, 2006. "Institutions, Networks and Entrepreneurship Development in Russia: An Exploration," IZA Discussion Papers 2161, Institute for the Study of Labor (IZA).
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:cgs:wpaper:31. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Pedro S. Martins)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.