Home biased analysts and corporate governance : evidence from Asian emerging markets

Dissertant

Taouss, Muhammad

Thesis advisor

Faruq, Umar

University

Al Akhawayn University

Faculty

The School of Business Administration

University Country

Morocco

Degree

Master

Degree Date

2009

English Abstract

This paper sheds light on the phenomenon of home bias present in analysts’ recommendations and its relationship with corporate governance.

Using a large data set from Hong Kong, Indonesia, Malaysia, Singapore, and Thailand we find that local analysts issue optimistic recommendations in favor of locally headquartered firms as opposed to foreign ones who are less optimistic in their recommendations for the same firms.

Our results indicate that bulk of this optimism difference existed in the pre-crisis period.

One of the reasons for this increased optimism in the pre-crisis period was the weakness of governance and disclosure mechanisms.

Ineffectiveness of these mechanisms induced foreign analysts, who, unlike their local counterparts, did not have access to private information, to issue more conservative recommendations relative to local analysts.

However, as the governance and information disclosure mechanisms improved in the countries under discussion, the optimism difference between foreign and local analysts decreased substantially.

We show that more than 50% of the optimism difference between the two groups was due to this difference in the pre-crisis period.

Main Subjects

Business Administration

No. of Pages

31

Table of Contents

• APA
• MLA
• AMA

Language

English

Data Type

Arab Theses

Record ID

BIM-629471