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Self-regulation in collaborative environments : the case of the equator principles in banking

Listed author(s):
  • Bos J.W.B.
  • Contreras M.G.
  • Kleimeier S.

    (GSBE)

Using banks in the syndicated lending market, we discuss a firm-specific strategy that has been overlooked by the literature, namely, that self-regulated firms pressure other non-self-regulated firms in an attempt to reduce effort asymmetries when collaborating. We develop a framework that shows when such a strategy is likely to be present. This framework is built on the view that the costs and benefits of collaboration are equally shared among self-regulated firms that collaborate. However, when self-regulated firms collaborate with non-self-regulated firms, the effort they exert differs and is not equally shared. In particular, we find that when firms collaborate, self-regulated firms pressure non-self-regulated firms to become self-regulated with the purpose of reducing effort asymmetries, and such a pressure increases with the duration of the collaboration.

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File URL: http://pub.maastrichtuniversity.nl/8db7e4be-43f4-4784-b530-87d389455e1d
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Paper provided by Maastricht University, Graduate School of Business and Economics (GSBE) in its series Research Memorandum with number 007.

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Date of creation: 2016
Handle: RePEc:unm:umagsb:2016007
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