Culture, Openness, and Finance

René Stulz and Rohan Williamson

No 8222, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Religions have little to say about shareholders but have much to say about creditors. We find that the origin of a country's legal system is more important than its religion and language in explaining shareholder rights. However, a country's principal religion helps predict the cross-sectional variation in creditor rights better than a country's openness to international trade, its language, its income per capita, or the origin of its legal system. Catholic countries protect the rights of creditors less than other countries, and long-term debt is less important in these countries. A country's openness to international trade mitigates the influence of religion on creditor rights. Religion and language are also important predictors of how countries enforce rights.

JEL-codes: G15 G30 (search for similar items in EconPapers)
Date: 2001-04
New Economics Papers: this item is included in nep-fin and nep-mfd
Note: CF
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Citations: View citations in EconPapers (49)

Published as Stulz, Rene M. & Williamson, Rohan, 2003. "Culture, openness, and finance," Journal of Financial Economics, Elsevier, vol. 70(3), pages 313-349, December.

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Journal Article: Culture, openness, and finance (2003)
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