Corporate Governance Quality: Trends and Real Effects

By Gianni De Nicolò, Luc Laeven, Kenichi Ueda. Social Science Research Network, 2006

143 citations recorded by the source corpus.

This paper constructs a composite index of corporate governance quality, documents its evolution during the 1994-2003 period in selected emerging and developed economies, and assesses its impact on growth and productivity of the economy and its corporate sector. Our investigation yields three main findings. First, corporate governance quality in most countries has overall improved, although in varying degrees and with a few notable exceptions. Second, the data exhibit cross-country convergence in corporate governance quality with countries that score poorly initially catching up with countries with high corporate governance scores. Third, the impact of improvements in corporate governance quality on traditional measures of real economic activity--GDP growth, productivity growth, and the ratio of investment to GDP--is positive, significant and quantitatively relevant, and the growth effect is particularly pronounced for industries that are most dependent on external finance.

Subfields: Accounting, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/d0ac2b227a9e5b0f17b187c274bc205cd5641b69

Citations in the corpus

• Convergence of Corporate Governance: Critical Review and Future Directions (2009, unknown): “…the inevitability or desirability of convergence of corporate governance practices around the world, important changes have indeed been occurring in corporate governance systems in all major industrialized and even emerging countries in recent years (e.g., De Nicolo, Laeven, and Ueda, 2008).”