To Steal or Not to Steal: Firm Attributes, Legal Environment, and Valuation

Artyom Durnev () and E. Han Kim

Journal of Finance, 2005, vol. 60, issue 3, 1461-1493

Abstract: Data on corporate governance and disclosure practices reveal wide within‐country variation that decreases with the strength of investors' legal protection. A simple model identifies three firm attributes related to that variation: investment opportunities, external financing, and ownership structure. Using firm‐level governance and transparency data from 27 countries, we find that all three firm attributes are related to the quality of governance and disclosure practices, and firms with higher governance and transparency rankings are valued higher in stock markets. All relations are stronger in less investor‐friendly countries, demonstrating that firms adapt to poor legal environments to establish efficient governance practices.

Date: 2005
References: Add references at CitEc
Citations: View citations in EconPapers (513)

Downloads: (external link)
https://doi.org/10.1111/j.1540-6261.2005.00767.x

Related works:
Working Paper: To Steal or Not to Steal: Firm Attributes, Legal Environment, and Valuation (2004)
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:bla:jfinan:v:60:y:2005:i:3:p:1461-1493

Ordering information: This journal article can be ordered from
http://www.afajof.org/membership/join.asp

Access Statistics for this article

More articles in Journal of Finance from American Finance Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().