標題: Political connections, corporate governance and preferential bank loans
作者: Yeh, Yin-Hua
Shu, Pei-Gi
Chiu, Shean-Bii
資訊管理與財務金融系 註:原資管所+財金所
Department of Information Management and Finance
關鍵字: Political connection;Corporate governance;Preferential bank loan
公開日期: 1-Jan-2013
摘要: The presidential election in Taiwan during 2000 resulted in the first political changeover in more than fifty years from the ruling party, the Kuomintang (KMT), to the Democratic Progressive Party (DPP). In 2004, the KMT was expected to win, but eventually lost to the DPP. We use these two exogenous events to investigate three issues: how political connections are related to preferential bank loans, how the entrenched position of the ruling party affects the types of preferential bank loans and how corporate governance is related to preferential bank loans. We find that KMT-connected (DPP-connected) firms were associated with higher (lower) abnormal returns before the 2004 election. This pattern of returns was reversed after the unexpected result. Moreover, we find that political connections were positively correlated with preferential bank loans. However, the types of preferential bank loans differed between KMT-connected and DPP-connected firms due to differences in the entrenched power of the ruling party. Finally, we find that corporate governance is negatively correlated with preferential bank loans, probably because firms with good corporate governance have more alternative financial sources. (C) 2012 Elsevier B.V. All rights reserved.
URI: http://dx.doi.org/10.1016/j.pacfin.2012.08.003
http://hdl.handle.net/11536/21118
ISSN: 0927-538X
DOI: 10.1016/j.pacfin.2012.08.003
期刊: PACIFIC-BASIN FINANCE JOURNAL
Volume: 21
Issue: 1
起始頁: 1079
結束頁: 1101
Appears in Collections:Articles


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