Do Foreigners Invest Less in Poorly Governed Firms?

• 成果类型: Article
• 署名作者: Leuz, Christian; Lins, Karl V.; Warnock, Francis E.
• 署名单位: Utah System of Higher Education; University of Utah; University of Chicago; National Bureau of Economic Research; University of Virginia; National Bureau of Economic Research
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhn089
• 发表日期: 2009
• 页码: 3245
• 关键词: CORPORATE GOVERNANCE; EQUITY OWNERSHIP; UNITED-STATES; institutional investors; international evidence; ULTIMATE OWNERSHIP; private benefits; cross-listings; Cash holdings; AGENCY COSTS

摘要

As domestic sources of outside finance are limited in many countries around the world, it is important to understand factors that influence whether foreign investors provide capital to a country's firms. We study 4,409 firms from twenty-nine countries to assess whether and why concerns about corporate governance result in fewer foreign holdings. We find that foreigners invest less in firms that reside in countries with poor outsider protection and disclosure and have ownership structures that are conducive to governance problems. This effect is particularly pronounced when earnings are opaque, indicating that information asymmetry and monitoring costs faced by foreign investors likely drive the results.