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Corporate Governance and Economic Performance

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  • Dennis Mueller

Abstract

What is the best corporate governance system? Is the Germanic corporate governance system the best? The Japanese? The Anglo-Saxon? This article reviews some of the relevant literature for answering this question. Particular attention is devoted to corporate governance problems in developing countries. It emphasizes that the nature of problems that corporate governance systems must deal with can be expected to vary with the state of development of a country. Central to any discussion of corporate governance is the question of how well a particular set of institutions mitigates the various principal/agent problems that arise in a firm. The article thus reviews the basic principal/agent problem and discusses its relevance for countries in different stages of development. It examines the advantages and disadvantages of each type of corporate governance system in mitigating principal/agent problems, and reviews the relevant empirical evidence for assessing their performance.

Suggested Citation

  • Dennis Mueller, 2006. "Corporate Governance and Economic Performance," International Review of Applied Economics, Taylor & Francis Journals, vol. 20(5), pages 623-643.
    • Handle: RePEc:taf:irapec:v:20:y:2006:i:5:p:623-643
    DOI: 10.1080/02692170601005598
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    4. Sueyoshi, Toshiyuki & Goto, Mika & Omi, Yusuke, 2010. "Corporate governance and firm performance: Evidence from Japanese manufacturing industries after the lost decade," European Journal of Operational Research, Elsevier, vol. 203(3), pages 724-736, June.
    5. Pitelis, Christos & Kelmendi, Pellumb, 2009. "The political economy of European anti-trust and industrial policy," MPRA Paper 23941, University Library of Munich, Germany.
    6. Christos N. Pitelis & Pellumb Kelmendi, 2011. "European Industrial Policy: Perspectives, Trends and a Sustainability-focused New Framework," Chapters, in: Miroslav N. Jovanović (ed.), International Handbook on the Economics of Integration, Volume II, chapter 2, Edward Elgar Publishing.
    7. Soo H. Lee & Taeyoung Yoo, 2008. "Competing Rationales for Corporate Governance in France: Institutional Complementarities between Financial Markets and Innovation Systems," Corporate Governance: An International Review, Wiley Blackwell, vol. 16(2), pages 63-76, March.
    8. Carlo Bellavite Pellegrini & Emiliano Sironi, 2017. "Does a one-tier board affect firms’ performances? Evidences from Italian unlisted enterprises," Small Business Economics, Springer, vol. 48(1), pages 213-224, January.
    9. Cohen, S.I. & Rettab, B., 2010. "Institutional barriers in labor markets: Examples, impacts, and policies," Socio-Economic Planning Sciences, Elsevier, vol. 44(4), pages 193-198, December.
    10. Marc Fleurbaey & Grégory Ponthière, 2021. "The stakeholder corporation and social welfare," Working Papers hal-03426120, HAL.

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