Corporate Governance in the Asian Financial Crisis

Posted: 26 Apr 2001

See all articles by Simon Johnson

Simon Johnson

Massachusetts Institute of Technology (MIT) - Entrepreneurship Center; National Bureau of Economic Research (NBER)

Peter D. Boone

affiliation not provided to SSRN

Alasdair Breach

Russian-European Centre for Economic Policy

Eric Friedman

Cornell University - Operations Research & Industrial Engineering

Abstract

The "Asian Crisis" of 1997-98 affected all the "emerging markets" open to capital flows. Measures of corporate governance, particularly the effectiveness of protection for minority shareholders, explain the extent of exchange rate depreciation and stock market decline better than do standard macroeconomic measures. A possible explanation is that in countries with weak corporate governance, worse economic prospects result in more expropriation by managers and thus a larger fall in asset prices.

Keywords: Corporate governance; Investor protection; Financial crisis

JEL Classification: G18, G38, K22

Suggested Citation

Johnson, Simon and Boone, Peter D. and Breach, Alasdair and Friedman, Eric, Corporate Governance in the Asian Financial Crisis. Available at SSRN: https://ssrn.com/abstract=251881

Simon Johnson (Contact Author)

Massachusetts Institute of Technology (MIT) - Entrepreneurship Center ( email )

United States
617-253-8412 (Phone)
617-258-6855 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Peter D. Boone

affiliation not provided to SSRN

Alasdair Breach

Russian-European Centre for Economic Policy ( email )

Potapovsky Pereulok 5
Building 4
101000 Moscow
Russia
(7 095) 232 3613 (Phone)
(7 095) 232 3739 (Fax)

Eric Friedman

Cornell University - Operations Research & Industrial Engineering ( email )

237 Rhodes Hall
Ithaca, NY 14853
United States
607-255-9130 (Phone)
607-255-9129 (Fax)

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