Corporate Performance and Policies Under Scrutiny: Guilty by Association?

Jan Hanousek, Iryna Hramiak, William L. Megginson and Anastasiya Shamshur

No 19771, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: In this paper, we examine the impact of Russia’s 2014 annexation of Crimea on firm performance in Ukraine, focusing on firms with Russian affiliations. Using a difference-in-differences approach, we find that firms with Russian majority ownership experienced a significant decline in performance compared to those without Russian ties. This decline stems from reduced sales, lower investment, restricted access to financing, and increased financial constraints. Notably, we differentiate between firms with visible Russian affiliations, such as Russian names, and those with Russian majority ownership. Our results show that deeper financial connections, rather than mere visibility, drive the negative impact. Firms with Russian ownership were also more likely to exit the market following the conflict. These findings provide important insights into how geopolitical risks affect corporate performance and firm strategic decisions

Keywords: investment (search for similar items in EconPapers)
JEL-codes: C23 D22 G30 M14 M16 (search for similar items in EconPapers)
Date: 2024-12
References: Add references at CitEc
Citations:

Downloads: (external link)
https://cepr.org/publications/DP19771 (application/pdf)

Related works:
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:cpr:ceprdp:19771

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP19771

Access Statistics for this paper

More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK.
Bibliographic data for series maintained by CEPR ().