IDEAS home Printed from https://ideas.repec.org/p/idb/wpaper/4323.html
   My bibliography  Save this paper

Corporate Governance and Private Capital Flows to Latin America

Author

Listed:
  • Alberto Chong

    ()

  • Alejandro Izquierdo

    ()

  • Alejandro Micco
  • Ugo Panizza

Abstract

According to recent research, external factors and political governance considerations are key determinants of capital flows in Latin America. We postulate that corporate governance is a crucial determinant as well. We show that while the region is characterized by relatively low levels of corporate governance it shows highly volatile capital flows. The high level of economic volatility that characterizes the region is partly due to the behavior of capital flows which, in turn, are influenced by external factors. The paper shows that by implementing better corporate governance the region could reduce the sensitivity of capital flows to external shocks and hence reduce the volatility of its economy.

Suggested Citation

  • Alberto Chong & Alejandro Izquierdo & Alejandro Micco & Ugo Panizza, 2003. "Corporate Governance and Private Capital Flows to Latin America," Research Department Publications 4323, Inter-American Development Bank, Research Department.
  • Handle: RePEc:idb:wpaper:4323
    as

    Download full text from publisher

    File URL: http://www.iadb.org/research/pub_hits.cfm?pub_id=WP-482&pub_file_name=pubWP-482.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Klapper, Leora F. & Love, Inessa, 2004. "Corporate governance, investor protection, and performance in emerging markets," Journal of Corporate Finance, Elsevier, vol. 10(5), pages 703-728, November.
    2. Guillermo A. Calvo & Leonardo Leiderman & Carmen M. Reinhart, 1993. "Capital Inflows and Real Exchange Rate Appreciation in Latin America: The Role of External Factors," IMF Staff Papers, Palgrave Macmillan, vol. 40(1), pages 108-151, March.
    3. repec:hrv:faseco:30728046 is not listed on IDEAS
    4. Shang-Jin Wei, 2000. "How Taxing is Corruption on International Investors?," The Review of Economics and Statistics, MIT Press, pages 1-11.
    5. Gary Gorton & Lixin Huang, 2004. "Liquidity, Efficiency, and Bank Bailouts," American Economic Review, American Economic Association, pages 455-483.
    6. Ugo Panizza, 2001. "Electoral Rules, Political Systems, and Institutional Quality," Economics and Politics, Wiley Blackwell, vol. 13(3), pages 311-342, November.
    7. Tirole, Jean, 2001. "Corporate Governance," Econometrica, Econometric Society, vol. 69(1), pages 1-35, January.
    8. Reinhart, Carmen & Calvo, Guillermo & Leiderman, Leonardo, 1993. "“Capital Inflows and Real Exchange Rate Appreciation in Latin America: The Role of External Factors," MPRA Paper 7125, University Library of Munich, Germany.
    9. Zvi Griliches, 1996. "The Discovery of the Residual: A Historical Note," Journal of Economic Literature, American Economic Association, pages 1324-1330.
    10. Adolfo Barajas & Roberto Steiner, 2002. "Credit Stagnation in Latin America," IMF Working Papers 02/53, International Monetary Fund.
    11. Arturo Galindo & Alejandro Micco, 2001. "Creditor Protection and Financial Cycles," IDB Publications (Working Papers) 1341, Inter-American Development Bank.
    12. Rafael La Porta & Florencio Lopez-De-Silanes & Andrei Shleifer, 1999. "Corporate Ownership Around the World," Journal of Finance, American Finance Association, vol. 54(2), pages 471-517, April.
    13. James R. Hines, Jr., 1995. "Forbidden Payment: Foreign Bribery and American Business After 1977," NBER Working Papers 5266, National Bureau of Economic Research, Inc.
    14. Ashoka Mody & Mark P. Taylor, 2013. "International capital crunches: the time-varying role of informational asymmetries," Applied Economics, Taylor & Francis Journals, vol. 45(20), pages 2961-2973, July.
    15. Johnson, Simon & Boone, Peter & Breach, Alasdair & Friedman, Eric, 2000. "Corporate governance in the Asian financial crisis," Journal of Financial Economics, Elsevier, pages 141-186.
    16. Paul Gompers & Joy Ishii & Andrew Metrick, 2003. "Corporate Governance and Equity Prices," The Quarterly Journal of Economics, Oxford University Press, vol. 118(1), pages 107-156.
    17. Shang-Jin Wei & Yi Wu, 2002. "Negative Alchemy? Corruption, Composition of Capital Flows, and Currency Crises," NBER Chapters,in: Preventing Currency Crises in Emerging Markets, pages 461-506 National Bureau of Economic Research, Inc.
    18. Shleifer, Andrei & Vishny, Robert W, 1997. " A Survey of Corporate Governance," Journal of Finance, American Finance Association, vol. 52(2), pages 737-783, June.
    19. Fernandez-Arias, Eduardo, 1996. "The new wave of private capital inflows: Push or pull?," Journal of Development Economics, Elsevier, pages 389-418.
    20. Guillermo A. Calvo & Alejandro Izquierdo & Ernesto Talvi, 2002. "Sudden Stops, the Real Exchange Rate and Fiscal Sustainability: Argentina's Lessons," IDB Publications (Working Papers) 1909, Inter-American Development Bank.
    21. Alejandro Izquierdo & Ernesto Talvi & Guillermo A. Calvo, 2002. "Sudden Stops, the Real Exchange Rate and Fiscal Sustainability: Argentina's Lessons," Research Department Publications 4299, Inter-American Development Bank, Research Department.
    22. repec:hrv:faseco:30747162 is not listed on IDEAS
    23. Reinhart, Carmen & Calvo, Guillermo, 2000. "When Capital Inflows Come to a Sudden Stop: Consequences and Policy Options," MPRA Paper 6982, University Library of Munich, Germany.
    24. Chuhan, Punam*Claessens,Constantijn A.*Mamingi,, 1993. "Equity and bond flows to Asia and Latin America : the role of global and country factors," Policy Research Working Paper Series 1160, The World Bank.
    25. Charles P. Oman, 2001. "Corporate Governance and National Development," OECD Development Centre Working Papers 180, OECD Publishing.
    26. Kaufmann, Daniel & Kraay, Aart & Zoido-Lobaton, Pablo, 1999. "Aggregating governance indicators," Policy Research Working Paper Series 2195, The World Bank.
    27. Wheeler, David & Mody, Ashoka, 1992. "International investment location decisions : The case of U.S. firms," Journal of International Economics, Elsevier, pages 57-76.
    28. Mitton, Todd, 2002. "A cross-firm analysis of the impact of corporate governance on the East Asian financial crisis," Journal of Financial Economics, Elsevier, vol. 64(2), pages 215-241, May.
    29. Alejandro Izquierdo, 2002. "Sudden Stops, the Real Exchange Rate and Fiscal Sustainability in Argentina," The World Economy, Wiley Blackwell, vol. 25(7), pages 903-923, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Luis H. Gutiérrez & Carlos Pombo & Rodrigo Taborda, 2005. "Propiedad y control en empresas colombianas," Research Department Publications 3221, Inter-American Development Bank, Research Department.
    2. Gutierrez, Luis H. & Pombo, Carlos & Taborda, Rodrigo, 2008. "Ownership and control in Colombian corporations," The Quarterly Review of Economics and Finance, Elsevier, vol. 48(1), pages 22-47, February.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:idb:wpaper:4323. 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: (Felipe Herrera Library). General contact details of provider: http://edirc.repec.org/data/iadbbus.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.