Crony Capitalism in Egypt

Chekir Hamouda and Ishac Diwan ()
Additional contact information
Chekir Hamouda: Harvard Kennedy School, Cambridge, MA, USA

Journal of Globalization and Development, 2014, vol. 5, issue 2, 177-211

Abstract: The paper studies the nature and extent of Egyptian “crony” capitalism by comparing the corporate performance and the stock market valuation of politically connected and unconnected firms, before and after the 2011 popular uprising that led to the end of President Mubarak rule. First, we identify politically connected firms and compare the corporate behavior of connected and unconnected large firms before 2011 in terms of their levels of debts, market share, and tax payment. Second, we conduct an event study around the events of 2011 and estimate the market valuation of political connections. Third, we attempt to decompose the extra value that the market attributes to political connections between a current profitability advantage, and future advantages that include higher growth opportunities and (implicit) bail-out guarantees.

Keywords: corruption; cronyism; Egypt; event study; value of political connections (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
https://doi.org/10.1515/jgd-2014-0025 (text/html)
For access to full text, subscription to the journal or payment for the individual article is required.

Related works:
Working Paper: Crony Capitalism in Egypt (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bpj:globdv:v:5:y:2014:i:2:p:177-211:n:2

Ordering information: This journal article can be ordered from
https://www.degruyter.com/journal/key/jgd/html

DOI: 10.1515/jgd-2014-0025

Access Statistics for this article

Journal of Globalization and Development is currently edited by Joseph E. Stiglitz, Kevin Gallagher, Jeronim Capaldo, Arjun Jayadev, José Antonio Ocampo and Dani Rodrik

More articles in Journal of Globalization and Development from De Gruyter
Bibliographic data for series maintained by Peter Golla ().