Creator of Knowledge
Information Resources Management Association
Advancing the Concepts & Practices of Information Resources Management in Modern Organizations

Equilibrium in Corporate Governance: Effects in Developing Countries

Equilibrium in Corporate Governance: Effects in Developing Countries
View Sample PDF
Author(s): Sonia Marcos (University of Burgos, Spain) and Luis A. Castrillo (University of Burgos, Spain)
Copyright: 2020
Pages: 19
Source title: Corporate Governance Models and Applications in Developing Economies
Source Author(s)/Editor(s): Otuo Serebour Agyemang (University of Cape Coast, Ghana), Abraham Ansong (University of Cape Coast, Ghana) and Ben Kwame Agyei-Mensah (Solbridge International School of Business, South Korea)
DOI: 10.4018/978-1-5225-9607-3.ch007


View Equilibrium in Corporate Governance: Effects in Developing Countries on the publisher's website for pricing and purchasing information.


Corporate governance systems around the world are shaped by legal traditions, but the most important determinant of their effectiveness is law enforcement. Developing countries tend to have weak institutional structures and contracting environments. In this context, markets are inefficient and ownership concentration becomes the main corporate governance mechanism in order to protect property rights. How can developing countries design an optimal corporate governance system in their poor business environments? Corporate governance mechanisms are interdependent, and each country needs to search for a set of mechanisms in equilibrium—that is, an optimal combination of control and incentives—that solves its own agency problems. But another problem in developing countries is the lack of public enforcement. Just as internal mechanisms may substitute for ineffective external mechanisms, private initiatives may reinforce weak public enforcement.

Related Content

Ben Kwame Agyei-Mensah, Otuo Serebour Agyemang, Abraham Ansong. © 2020. 22 pages.
Fatima Albedal, Allam Mohammed Hamdan, Qasim Zureigat. © 2020. 27 pages.
Shinu Vig, Manipadma Datta. © 2020. 13 pages.
Iustina A Boitan. © 2020. 19 pages.
Dmitry Shevchenko, Parmenas Kimani Njoroge. © 2020. 19 pages.
Fredrick Ikpesu, Olusegun Vincent, Olamitunji Dakare. © 2020. 12 pages.
Sonia Marcos, Luis A. Castrillo. © 2020. 19 pages.
Body Bottom