Corporate Governance and International Location Decisions of Multinational Enterprises

18 Pages Posted: 13 Dec 2007

See all articles by Lammertjan Dam

Lammertjan Dam

University of Groningen - Faculty of Economics and Business

Bert Scholtens

University of Groningen - Department of Finance & Accounting

Elmer Sterken

University of Groningen - Faculty of Economics and Business; CESifo (Center for Economic Studies and Ifo Institute)

Abstract

This paper analyzes international location decisions of corporations based on corporate governance considerations. Using firm level data on 540 Multinational Enterprises (MNEs) with 44,149 subsidiaries in 188 countries, we test whether firms with relatively good governance standards are more often located in countries with a weak governance system. We find empirical support for this hypothesis, especially for those corporations present in low-income countries.

Suggested Citation

Dam, Lammertjan and Scholtens, Bert and Sterken, Elmer, Corporate Governance and International Location Decisions of Multinational Enterprises. Corporate Governance: An International Review, Vol. 15, Issue 6, pp. 1330-1347, November 2007, Available at SSRN: https://ssrn.com/abstract=1072217 or http://dx.doi.org/10.1111/j.1467-8683.2007.00649.x

Lammertjan Dam (Contact Author)

University of Groningen - Faculty of Economics and Business ( email )

Postbus 72
9700 AB Groningen
Netherlands
+31-50-3636518 (Phone)

Bert Scholtens

University of Groningen - Department of Finance & Accounting ( email )

P.O. Box 800
9700 AH Groningen
Netherlands

Elmer Sterken

University of Groningen - Faculty of Economics and Business ( email )

Postbus 72
9700 AB Groningen
Netherlands

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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