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Listing Advantages Around the World

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Listed:
  • UEDA Kenichi
  • Somnath SHARMA

Abstract

Using the firm-level data of 33 countries over 10 years (2008-2017), we find that the listed firms have lower returns on assets than the similar unlisted firms, in most countries. The result is associated with a higher capital-labor ratio of listed firms, implying that listed firms face fewer financial constraints. Moreover, we investigate the institutional factors that exacerbate or mitigate the listing advantages (i.e., ROA difference) across the countries. Compared to English origin law, countries with German and Scandinavian legal origins strongly narrow the listing advantages but the French legal origin shows mixed results. Overall, the listing advantages seem narrowed with stronger creditor's rights, but show unclear associations with the strength of corporate governance.

Suggested Citation

  • UEDA Kenichi & Somnath SHARMA, 2020. "Listing Advantages Around the World," Discussion papers 20060, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:20060
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    1. Kenichi UEDA & Khaliun Dovchinsuren, 2020. "Allocative Efficiency of Capital across Japanese Firms," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 16(7), pages 1-22, October.

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    More about this item

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity

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