Suchergebnisse

AbstractLeft-leaning and right-leaning governments hold opposing views on economic policy, resulting in disparities in economic behaviours and outcomes. Given this context, we explore the effect of political ideology on domestic credit using an unbalanced panel data of 29 countries from 1960 to 2014. Our empirical analysis shows that left-leaning governments reduce total domestic credit allocations. Also, we find that right-leaning governments provide more credit to the private sector, while left-leaning governments prefer to boost domestic credit to the public sector. In a further analysis, we show that political parties and their domestic credit strategies remain unchanged even during electoral periods. Our novel insights, that are robust to alternative measures, samples, and a set of econometric identifications, contribute to the literature on partisan politics and lending behaviour.

AbstractResearch Question/IssueWe examine the role of board gender diversity in attenuating loan covenant violations. We also investigate whether the relationship is influenced by female independent directors. Finally, we examine the channels of this relationship.Research Findings/InsightsDrawing on gender socialization and diversity theories, our findings show that firms with gender‐diverse boards are less likely to violate loan covenants. We also find that boards with more female directors have a stronger impact on loan covenant violations than those with fewer female directors, consistent with critical mass theory. Our results also suggest that the negative relationship stems from female independent directors rather than from female executive directors. Our channel analyses indicate that the relationship is routed through covenant strictness, the financial performance of firms, and better corporate governance. Our further analysis demonstrates that the relationship is pronounced in female‐dominated industries and financially distressed firms, as well as in firms whose directors have greater experience. Our results are robust across a series of sensitivity and endogeneity tests.Theoretical/Academic ImplicationsWe contribute to an emerging strand of literature that examines the link between board gender diversity and loan covenants. We fill a gap in this stream of literature by providing the first empirical evidence that female directors in the boardroom reduce loan covenant violations through their greater integrative bargaining skills during loan deals, improving firm financial performance, and ensuring good corporate governance. Our study also contributes to the growing literature on the differential effects on corporate policies of female directors (independent and executive) and critical mass.Practitioner/Policy ImplicationsThis finding offers significant policy implications for managers, investors, and policymakers. Given the growing frequency of loan covenant violations, the presence of a gender‐diverse board should serve as a potent indicator to creditors who have a concern regarding loans. In addition, our study adds to the ongoing debate regarding the business case of board gender diversity.

Considering the importance of political economy in implementing Disaster Risk Reduction (DRR), this research investigates the significance of political economy in the distribution of DRR funding in Bangladesh. The study analysed data from self-reported surveys from 133 members of the sub-district level disaster management committee and government officials working with DRR. Employing the Partial Least Squares Structural Equation Modeling (PLS-SEM) method, we find that political economy factors explain 68% of the variance in funding allocations. We also show that four categories of political economy factors-power and authority, interest and incentives, institutions, and values and ideas-are significantly influential over the distribution of DRR funding across subdistricts of Bangladesh. Our findings offer important policy implications to reduce the potential risks surrounding political economy influences in fund allocation and advance climate finance literature.