 Do good governance provisions shelter investors from contagion? Evidence from the Russian crisis1The Economics of Transition, 2007, vol. 15, issue 4, 807-824 Abstract: This paper studies how the Russian crisis of 1998 affected listed firms in transition economies. The data cover 394 companies that were listed before the Russian crisis, and include financial, industry, ownership and stock market information. Results show that in the short term (within one month of the crisis) good governance did not shelter investors from contagion. On the contrary, stock returns during the crisis period were lower for the largest and most liquid stocks and markets in the region irrespective of their direct exposure to Russia. The paper also documents that in the longer term (one year after the crisis) recovery was faster in firms without direct trade exposure to Russia, as well as in firms with better firm‐level governance as proxied by the presence of a foreign blockholder. The paper presents evidence that both firm‐ and country‐level characteristics are important in overcoming the effects of a crisis. Firm‐specific characteristics, however, play a bigger role for companies operating in countries with weaker corporate governance. Date: 2007 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:etrans:v:15:y:2007:i:4:p:807-824 Ordering information: This journal article can be ordered from Access Statistics for this article The Economics of Transition is currently edited by Philippe Aghion and Wendy Carlin More articles in The Economics of Transition from The European Bank for Reconstruction and Development Contact information at EDIRC. |
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