The Impact of Institutional Differences on Derivatives Usage: A Comparitive Study of Us and Dutch Firms

41 Pages Posted: 2 Jun 2002

See all articles by Gordon M. Bodnar

Gordon M. Bodnar

Johns Hopkins University - Paul H. Nitze School of Advanced International Studies (SAIS)

Abe de Jong

Rotterdam School of Management, Erasmus University; Monash University

Victor Macrae

Nyenrode University - Center for Finance

Date Written: April 2002

Abstract

This paper examines the influence of institutional differences on corporate risk management practices in the US and the Netherlands. We compare results to surveys in each country using a strategy that corrects for differences over industry and size classes across the Dutch and US samples. We document several differences in the firms' uses and attitudes towards derivatives and attempt to attribute them to the differences in the institutional environments between the US and the Netherlands. We find that institutional differences appear to have an important impact on risk management practices and derivatives use across US and Dutch firms.

Keywords: risk management, derivatives, hedging, international finance

JEL Classification: F30, G15, G32

Suggested Citation

Bodnar, Gordon M. and de Jong, Abe and Macrae, Victor, The Impact of Institutional Differences on Derivatives Usage: A Comparitive Study of Us and Dutch Firms (April 2002). ERIM Report Series Reference No. ERS-2001-89-F&A; EFMA 2002 London Meetings. Available at SSRN: https://ssrn.com/abstract=313939 or http://dx.doi.org/10.2139/ssrn.313939

Gordon M. Bodnar (Contact Author)

Johns Hopkins University - Paul H. Nitze School of Advanced International Studies (SAIS) ( email )

1740 Massachusetts Avenue, NW
Washington, DC 20036
United States
202-663-7731 (Phone)
202-663-7718 (Fax)

Abe De Jong

Rotterdam School of Management, Erasmus University ( email )

P.O. Box 1738
Room T08-25
Rotterdam, 3000 DR
Netherlands
+31 10 408 1022 (Phone)

HOME PAGE: http://https://www.rsm.nl/people/abe-de-jong/

Monash University ( email )

900 Dandenong Rd
Room H3-56
Caulfield East, Victoria 3145
Australia

HOME PAGE: http://https://research.monash.edu/en/persons/abe-de-jong

Victor Macrae

Nyenrode University - Center for Finance ( email )

3621 BG Breukelen
Netherlands

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