Business groups in developing capital markets: Towards a complementarity perspective
BG
s) in developing economies have emerged as alternatives to poorly developed economic institutions in these countries. In this paper, we argue that this does not imply they are always substitutes. Specifically, we consider the case of capital markets, a key economic institution: while the absence of well‐developed capital markets may indeed have stimulated the emergence of business groups, we propose that
BG
affiliation and the scrutiny that maturing capital markets impose on firms that participate actively in them nevertheless can play a complementary role in influencing a firm's performance. We find support for our predictions in a novel longitudinal data set of Indian firms that contain both listed and unlisted
BG
affiliated as well as unaffiliated firms
. Copyright © 2014 John Wiley & Sons, Ltd.
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- Published
- Jul 08, 2014
- Vol/Issue
- 36(9)
- Pages
- 1277-1296
- License
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