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Corporate Governance in the Asian Financial Crisis

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  • Simon Johnson
  • Peter Boone
  • Alasdair Breach
  • Eric Friedman

Abstract

The "Asian Crisis" of 1997-98 affected all the "emerging markets" open to capital flows. Measures of corporate governance, particularly the effectiveness of protection for minority shareholders, explain the extent of depreciation and stock market decline better than do standard macroeconomic measures. A possible explanation is that in countries with weak corporate governance, worse economic prospects result in more expropriation by managers and thus a larger fall in asset prices.

Suggested Citation

  • Simon Johnson & Peter Boone & Alasdair Breach & Eric Friedman, 1999. "Corporate Governance in the Asian Financial Crisis," William Davidson Institute Working Papers Series 297, William Davidson Institute at the University of Michigan.
    • Handle: RePEc:wdi:papers:1999-297
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    References listed on IDEAS

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