National culture and private benefits of control

Astrid Salzmann and Kalender Soypak

Finance Research Letters, 2017, vol. 20, issue C, 199-206

Abstract: Our paper examines the relationship between national culture and private benefits of control. We concentrate on the Hofstede dimensions and analyze their role for a range of instruments that directly relate to the private benefits of control. In this sense, our proxies reflect how power is distributed among shareholders indicating the potential a given shareholder has to extract private benefits. In a cross-country analysis of 36 countries, we show that power distance relates positively to the expropriation of private benefits of control, whereas individualism exhibits a negative relationship. Our results are statistically significant and robust to several alternative specifications.

Keywords: Private benefits of control; National culture (search for similar items in EconPapers)
JEL-codes: F30 G15 G34 Z10 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:20:y:2017:i:c:p:199-206

DOI: 10.1016/j.frl.2016.09.027

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