Calendrier du 17 janvier 2018
Development Economics Seminar
Du 17/01/2018 de 16:30 à 18:00
salle R2-01, campus Jourdan - 48 bd Jourdan 75014 Paris
POMERANZ Dina (Harvard Business School )
Can audits backfire? Evidence from public procurement in Chile
Economic History Seminar
Du 17/01/2018 de 12:30 à 14:00
Salle R2-01, Campus Jourdan, 48 boulevard Jourdan, 75014 Paris
HILT Eric (Wellesley College)
Banks, Insider Connections, and Industrialization in New England: Evidence from the Panic of 1873.
Using newly collected data from Massachusetts, this paper documents the extent of bank
director representation non-financial firms’ boards, and investigates whether bank-affiliated companies
fared better during the recession that followed the Panic of 1873. Around 59 percent of all non-financial
corporations had at least one bank director on their boards. These firms survived the recession of the
1870s at higher rates, and among the surviving firms, those with bank affiliations saw their growth rates
and credit ratings decline less than firms without bank affiliations. Consistent with banker-directors
helping to resolve problems related to asymmetric information, these effects were strongest among
younger firms, and those with lower shares of fixed assets on their balance sheets. In contrast, the
presence of bank cashiers on firms’ boards, which created an association with a bank without significantly
increasing the likelihood of a credit relationship, had no effect. These results imply that during New
England’s industrialization, affiliations with commercial banks helped nonfinancial corporations survive
economic downturns.