Quality of Corporate Governance and Financial Structure Choice in Developing Countries
Quality of Corporate Governance and Financial Structure Choice in Developing Countries

Summary/Abstract: A widely debated topic during the last years is represented by the choice of financial structure of companies, especially in developing countries, characterized by economies without a tough and a mature financial system. As well, the researchers’ attention is focused mostly on linkage between capital structure and firm performance, only few of them considering the influence of companies’ institutional architecture and the main features of their governance in selecting of their financial structure. Using especially data provided from World Bank Enterprise Surveys website, we studied the linkage between corporate governance quality and its ability to influence the financial structure of the companies in a dataset covering a number of 26 developing countries from Central and Eastern Europe, Africa, Asia and Latin America. The main output of the study consists in the fact that the financial structure of the companies in developing countries is considerable influenced by the corporate governance quality.

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