Privatization in emerging economies: An agency theory perspective

Research output: Contribution to journalReview article

372 Scopus citations

Abstract

The ineffectiveness of several privatized firms within emerging economies underscores the importance of agency theory issues and their impact on the privatization-performance relationship. We argue that weak governance and limited protection of minority shareholders intensify traditional principal-agent problems (perquisite consumption and entrenchment) and create unique agency problems (expropriation). We suggest that postprivatization performance can be enhanced by using appropriate ownership, management, and corporate structures that mitigate agency problems in the context of weak governance, and we highlight avenues for research.

Original languageEnglish (US)
Pages (from-to)650-669
Number of pages20
JournalAcademy of Management Review
Volume25
Issue number3
StatePublished - Jul 1 2000

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ASJC Scopus subject areas

  • Business, Management and Accounting(all)
  • Strategy and Management
  • Management of Technology and Innovation

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