National Culture and Corporate Governance
Aachen University - Department of Finance
Astrid Juliane Salzmann
RWTH Aachen University - Chair for Business Administration, particularly Business Finance
August 16, 2010
23rd Australasian Finance and Banking Conference 2010 Paper
In a series of cross-country comparisons, we show that national culture is statistically significant in differentiating countries with different corporate governance systems. Using the Schwartz cultural value model and data on corporate governance systems, we analyze the impact of national culture on six dimensions of corporate governance. Countries that have stronger emphasis on the dimensions of Embeddedness, Egalitarianism, and Harmony are more likely to have bank-based systems, while countries with a stronger emphasis on Autonomy, Hierarchy, and Mastery tend to have market-based systems. The findings suggest several implications for the ongoing debate on convergence and divergence of corporate governance systems and policy reforms regarding financial crises.
Number of Pages in PDF File: 65
Keywords: corporate governance, national culture
JEL Classification: A13, G10, G30, N20, Z13working papers series
Date posted: August 18, 2010 ; Last revised: January 7, 2011
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