Corporate Governance: Effects on Firm Performance and Economic Growth

CONVERGENCE AND DIVERSITY OF CORPORATE GOVERNANCE REGIMES AND CAPITAL MARKETS, L. Renneboog, J. McCahery, P. Moerland and T. Raaijmakers, eds., Oxford Univ. Press, 2000

Posted: 2 Nov 2000

See all articles by Maria Maher

Maria Maher

Organization for Economic Co-Operation and Development (OECD) - Economics Department (ECO)

Thomas Andersson

Jonkoping University

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Abstract

This paper examines some of the strengths, weaknesses, and economic implications associated with various corporate governance systems in OECD countries. Each country has through time developed a wide variety of mechanisms to overcome the agency problems arising from the separation of ownership and control. We discuss the various mechanisms employed in different systems (e.g. the market for corporate control, executive remuneration schemes, concentrated ownership, cross-shareholdings amongst firms) and assess the evidence on whether or not they are conducive to firm performance and economic growth. For example, we show how the corporate governance framework can impinge upon the development of equity markets, R&D and innovative activity, and the development of an active SME sector, and thus impinge upon economic growth. Several policy implications are identified.

JEL Classification: G32, G34, G38

Suggested Citation

Maher, Maria E. and Andersson, Thomas, Corporate Governance: Effects on Firm Performance and Economic Growth. CONVERGENCE AND DIVERSITY OF CORPORATE GOVERNANCE REGIMES AND CAPITAL MARKETS, L. Renneboog, J. McCahery, P. Moerland and T. Raaijmakers, eds., Oxford Univ. Press, 2000, Available at SSRN: https://ssrn.com/abstract=239026

Maria E. Maher

Organization for Economic Co-Operation and Development (OECD) - Economics Department (ECO)

2 rue Andre Pascal
Paris Cedex 16, MO 63108
France

Thomas Andersson (Contact Author)

Jonkoping University ( email )

SE-551 11 Jonkoping
Sweden

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