Publication: Adverse selection and corporate governance
Issued Date
2011-06-01
Resource Type
ISSN
10590560
Other identifier(s)
2-s2.0-79956320923
Rights
Mahidol University
Rights Holder(s)
SCOPUS
Bibliographic Citation
International Review of Economics and Finance. Vol.20, No.3 (2011), 406-420
Suggested Citation
Charlie Charoenwong, David K. Ding, Vasan Siraprapasiri Adverse selection and corporate governance. International Review of Economics and Finance. Vol.20, No.3 (2011), 406-420. doi:10.1016/j.iref.2010.11.011 Retrieved from: https://repository.li.mahidol.ac.th/handle/20.500.14594/11849
Research Projects
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Title
Adverse selection and corporate governance
Abstract
This paper examines the impact of corporate governance on the adverse selection component of the bid-ask spread of stocks listed on the Singapore Exchange. These companies have been identified by Credit Lyonnais Securities Asia (CSLA) with the highest level of corporate governance among 25 emerging markets. We measure corporate governance by several criteria: discipline, transparency, independence, accountability, responsibilities, fairness, and social awareness. The results show that corporate governance has an inverse relationship with adverse selection. However, only the transparency dimension exhibits a significant inverse relationship with adverse selection. In addition, Government-Linked Companies (GLCs) are shown to have a smaller adverse selection component than non-GLCs. © 2010 Elsevier Inc.
