Political connections of newly privatized firms |
| |
Authors: | Narjess Boubakri Jean-Claude Cosset Walid Saffar |
| |
Institution: | aHEC Montréal, 3000 Chemin Côte-Sainte-Catherine, Montréal, Québec, Canada H3T 2A7;bAmerican University of Sharjah, United Arab Emirates;cCollege of Business, University of Southern Indiana, United States |
| |
Abstract: | We investigate the extent of political connections in newly privatized firms. Using a sample of 245 privatized firms headquartered in 27 developing and 14 developed countries over the period 1980 to 2002, we find that 87 firms have a politician or an ex-politician on their board of directors. Politically-connected firms are generally incorporated in major cities, are highly leveraged, and operate in regulated sectors. The likelihood of observing political connections in these firms is positively related to government residual ownership, and negatively related to foreign ownership. Political fractionalization and tenure, as well as judicial independence are also key explanatory variables. Finally, politically-connected firms exhibit a poor accounting performance compared to their non-connected counterparts. |
| |
Keywords: | Privatization Political connection Characteristics Performance |
本文献已被 ScienceDirect 等数据库收录! |
|