The Dark Side of Disclosure : Evidence of Government Expropriation from Worldwide Firms

Liu, Tingting ; Ullah, Barkat ; Wei, Zuobao ; Xu, Lixin Colin

World Bank, Washington, DC

关键词: GROWTH RATES;    LINE OF CREDIT;    DEPOSIT;    LINES OF CREDIT;    COMPETITORS;   

DOI  :  10.1596/1813-9450-7254
RP-ID  :  WPS7254

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper studies the effects ofvoluntary accounting information disclosure through auditingon firm access to finance, exposure to corruption, and salesgrowth. Relying on a data set of more than 70,000 firms in121 countries, the analysis finds that disclosure can be adouble-edged sword. On the one hand, audited firms exhibit aslightly lower level of financial constraints than unauditedfirms. On the other hand, audited firms face a significantlyhigher level of corruption obstacles. The net effects ofvoluntary information disclosure on firm growth arenegative, which can largely be explained by the fact thatmost of the countries in the sample are developing countrieswhere institutions are weak. The beneficial effect ofdisclosure increases as a country’s property rightsprotection improves. The qualitative results are robust toconsiderations of the endogeneity of auditing and toalternative measures of corruption and financialconstraints. The findings reveal the dark side of voluntaryinformation disclosure: exposing firms to governmentexpropriation where institutions are weak.