University of Utah
NBER Working Papers and Publications
|March 2010||Do Foreigners Invest Less in Poorly Governed Firms?|
with Christian Leuz, Francis E. Warnock
in Corporate Governance, Michael Weisbach, editor
|May 2006||Do Foreigners Invest Less in Poorly Governed Firms?|
with Christian Leuz, Francis E. Warnock: w12222
As domestic sources of outside finance are limited in many countries around the world, it is important to understand the factors that influence whether foreign outside investors provide capital to a country's firms. This study examines whether and why investor concern about corporate governance results in fewer foreign holdings. We use a comprehensive set of foreign holdings by U.S. investors as a proxy for foreign investment and analyze a sample of 4,411 firms from 29 emerging market and developed economies. We find that foreigners invest significantly less in firms that are poorly governed, i.e., firms that have ownership structures that are more conducive to outside investor expropriation. Interestingly, this finding is not simply a matter of a country's economic development but appears...
Published: Review of Financial Studies 2009 Vol 22, Issue 8: pp. 3245-3285 citation courtesy of
|March 2005||Private Benefits of Control, Ownership, and the Cross-Listing Decision|
with Craig Doidge, G. Andrew Karolyi, Darius P. Miller, Rene M. Stulz: w11162
This paper investigates how a foreign firm's decision to cross-list its shares in the U.S. is related to the concentration of the ownership of its cash flow rights and of its control rights. Theory has proposed that when private benefits are high, controlling shareholders are less likely to choose to list their firm's shares in the U.S. because the higher standards for transparency and disclosure, as well as the increased monitoring associated with such listings, limit their ability to extract private benefits. We offer evidence that confirms this hypothesis using data on more than 4,000 firms from 31 countries. Using logistic regression analysis, we show that the control rights held by controlling shareholders, as well as the difference between their control rights and their cash flow rig...
Published: Doidge, Craig, G. Andrew Karolyi, Karl V.Lins, Darius P. Miller, and Rene M. Stulz. "Private Benefits of Control, Ownership, and the Cross-Listing Decision." Journal of Finance 64, 1 (February 2009): 425-66. citation courtesy of
|September 2001||The Effect of Capital Structure When Expected Agency Costs are Extreme|
with Campbell R. Harvey, Andrew H. Roper: w8452
We provide new evidence that debt creates shareholder value for firms that face agency costs. Our tests are unique in two respects. First, we focus on a sample of firms with potentially extreme agency problems. We study emerging market firms where the routine use of pyramid ownership structures provides an acute separation of management cash flow rights and control rights. Second, we argue that not all debt is the same. Using new data on global debt issuance, we find that the type of debt that positively impacts shareholder value is the type that closely monitors management. This combination of a sample of firms with extreme expected agency problems and detailed information on the different types of debt allows us to construct powerful tests of whether debt can mitigate the effects of agen...
Published: Harvey, Campbell R., Karl V. Lins and Andrew H. Roper. "The Effect Of Capital Structure When Expected Agency Costs Are Extreme," Journal of Financial Economics, 2004, v74(1,Oct), 3-30. citation courtesy of