Financial development, corporate governance and cost of equity capital
Files
(Published version)
Date
2018
Authors
Gupta, K.
Krishnamurti, C.
Tourani Rad, A.
Editors
Advisors
Journal Title
Journal ISSN
Volume Title
Type:
Journal article
Citation
Journal of Contemporary Accounting and Economics, 2018; 14(1):65-82
Statement of Responsibility
Conference Name
Abstract
Existing research suggests that external governance is more relevant than internal governance in affecting a firm's value. We contribute to the literature by explicitly examining the interactive role played by country-level financial development and legal institutions in influencing the impact of firm-level governance on the cost of equity capital. Using a comprehensive sample of7380 firm years drawn from 22 developed countries, we show that firm-level corporate governance attributes affect the cost of equity capital primarily in the Common Law countries with high levels of financial development. Our study is the first to highlight the complementary effects of legal origin, financial development and firm-level governance attributes in influencing the costof equity capital.
School/Discipline
Dissertation Note
Provenance
Description
Access Status
Rights
Copyright 2018 Elsevier
Access Condition Notes: Accepted manuscript is available open access