To Share Is To Keep: Politicians, Property Rights and Firm Ownership in Post-Apartheid South Africa
نویسنده
چکیده
Institutions that fail to protect citizens against expropriation from the government hinder investment and economic development. How do economic agents counteract these institutions? I propose a theory of companies establishing connections with politicians as a mechanism to protect property rights and increase investment. I build a model in which N companies face a sector-level threat of expropriation. As a response to that threat, the owner of each company non-cooperatively decides what fraction of her shares to transfer to a politician who is pivotal in the expropriation decisions of the government. The model predicts that an exogenous shift in the share transfers of company i increases that company's investment by reducing the sector-level risk of expropriation. This, in turn, generates a sector-level positive externality which indirectly increases investment of other companies in company's
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متن کاملUniversity of Huddersfield Repository Ntim , Collins G . Corporate Governance , Affirmative Action and Firm Value in Post - apartheid South Africa : A Simultaneous Equation Approach
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