Corporate governance and FDIm : firm-level evidence from Japanese FDI into the US
Alba, Joseph Dennis
Date of Issue2012
College of Humanities, Arts, and Social Sciences
Better corporate governance can reduce the scope for increasing shareholder value and thus discourage M&A FDI inflows. Sound governance may also discourage non-M&A FDI inflows in light of the complementary relationship between M&A and non-M&A FDI. We use firm-level evidence to empirically examine the effect of US corporate governance on Japanese M&A and non-M&A FDI. We find that two landmark US corporate governance regulations help explain the sharp drop in both Japanese M&A and non-M&A FDI into the US during the 1990s. Our evidence suggests that corporate governance may affect both M&A and non-M&A FDI.
DRNTU::Social sciences::Economic theory
International review of economics & finance