Do Peer Effects Matter for Explaining Corporate Board Structures?

31 Pages Posted: 5 Apr 2017

See all articles by Ajay Yadav

Ajay Yadav

Duke University, Fuqua School of Business, Students; University of Delhi, Students

Ujala Shanker

University of California, Berkeley - The Richard & Rhoda Goldman School of Public Policy

Date Written: March 30, 2017

Abstract

This article examines role of peer effects in determining corporate board structures. We use differences in new guidelines by NYSE and NASDAQ post Sarbanes-Oxley to construct a novel instrument to estimate our peer effects model. We find a strong presence of peer effects in determining board structure and independence of its subcommittees but not overall board independence. The results suggest that one percentage point change in average peer board measure leads to a change of 0.5 percentage points or more in the same direction depending on the board structure measure in question.

JEL Classification: G34, G38

Suggested Citation

Yadav, Ajay and Shanker, Ujala, Do Peer Effects Matter for Explaining Corporate Board Structures? (March 30, 2017). Available at SSRN: https://ssrn.com/abstract=2943354 or http://dx.doi.org/10.2139/ssrn.2943354

Ajay Yadav (Contact Author)

Duke University, Fuqua School of Business, Students ( email )

University of Delhi, Students ( email )

Delhi
India

Ujala Shanker

University of California, Berkeley - The Richard & Rhoda Goldman School of Public Policy ( email )

2607 Hearst Avenue
Berkeley, CA 94720-7320
United States

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