Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/30631
Authors: 
Belloc, Marianna
Pagano, Ugo
Year of Publication: 
2009
Series/Report no.: 
CESifo Working Paper 2883
Abstract: 
Most pre-crisis explanations of the various corporate governance systems have considered the separation between ownership and control to be an advantage of the Anglo-American economies. They have also attributed the failure of other countries to achieve these efficient arrangements to their different legal and/or electoral systems. In this paper we compare this view with the co-evolution approach based on the hypothesis that politics and corporate governance influence each other, generating complex interactions of financial and labour market institutions. Countries cluster along different complementary politics-business interaction paths and there is no reason to expect, or to device policies for, their convergence to a single model of corporate governance. We argue that this hypothesis provides a more convincing explanation of the past histories of major capitalist economies and can suggest some useful possible scenarios of their future institutional development. Bayesian model comparison suggests that the co-evolution approach turns out at least as influential as the competing theories in explaining shareholder and worker protection determination.
Subjects: 
employment protection
corporate governance
ownership concentration
Bayesian model estimation
Bayesian model comparison
JEL: 
G32
G34
J50
K22
P10
Document Type: 
Working Paper

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