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Financial development, corporate governance and cost of equity capital

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dc.contributor.authorGupta, K.
dc.contributor.authorKrishnamurti, C.
dc.contributor.authorTourani Rad, A.
dc.date.issued2018
dc.description.abstractExisting 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.
dc.identifier.citationJournal of Contemporary Accounting and Economics, 2018; 14(1):65-82
dc.identifier.doi10.1016/j.jcae.2018.02.001
dc.identifier.issn1815-5669
dc.identifier.urihttps://hdl.handle.net/11541.2/131046
dc.language.isoen
dc.publisherElsevier
dc.rightsCopyright 2018 Elsevier Access Condition Notes: Accepted manuscript is available open access
dc.source.urihttps://doi.org/10.1016/j.jcae.2018.02.001
dc.subjectcorporate governance
dc.subjectfinancial development
dc.subjectlegal origin
dc.subjectimplied cost of equity capital
dc.titleFinancial development, corporate governance and cost of equity capital
dc.typeJournal article
pubs.publication-statusPublished
ror.fileinfo12298553360001831 13298503350001831 Open Access Postprint
ror.mmsid9916175874701831

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