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- Title
CORRUPTION AND CORPORATE FINANCE PATTERNS: AN INTERNATIONAL PERSPECTIVE.
- Authors
Julan Du
- Abstract
This study demonstrates the importance of government corruption in shaping corporate finance patterns across countries. Corruption contributes to a more prevalent and higher degree of corporate equity ownership concentration and more reliance on bank financing in raising external finance. It argues that corporate governance under corrupt governments is particularly poor. Firm management, taking advantage of political capital acquired through bribery, is especially powerful in expropriating from outside investors. Ownership concentration and reliance on bank financing are means of mitigating the corporate governance problem under a corrupt government.
- Subjects
CORRUPTION; POLITICAL corruption; BRIBERY; CORPORATE finance; CORPORATE directors; CORPORATE governance; BANK loans
- Publication
Pacific Economic Review, 2008, Vol 13, Issue 2, p183
- ISSN
1361-374X
- Publication type
Article
- DOI
10.1111/j.1468-0106.2008.00396.x