We examine the effect of trust on financial investment and contracting decisions in a micro-economic environment where trust is exogenous. Using hand-collected data on European venture capital, we show that the Eurobarometer measure of trust among nations significantly affects investment...

In this paper, we investigate the attitudes of institutional investors, such as hedge funds, insurance companies, mutual funds and pension funds, towards a key corporate governance mechanism, namely executive compensation. The purpose of this study is to document the preferences they have about...

Royal Ahold (Koninklijke Ahold NV) was one of the major success stories in the 1990s and is one of the major failures, suffering a complete meltdown, in 2003.We investigate the strategy, accounting transparency and corporate governance of Ahold; elements which jointly drive the firm s performance...

This study investigates the impact of corporate governance and product market competition on total factor productivity growth in Germany and the UK.For Germany, the prototype of a bank-based governance system, productivity grows faster in firms controlled by financial institutions (in...

This paper finds that shareholder-friendly corporate governance is positively associated with bank insolvency risk, as proxied by the Z-score and the Merton’s distance to default measure, for an international sample of banks over the 2004-2008 period. Banks are special in that ‘good’...