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Essays on Financial Development, Ownership Structure, and Banks’ Disclosure and Moral Hazard Activities: Social Trust Approach

Jiao, Feng
http://rave.ohiolink.edu/etdc/view?acc_num=kent1273455901

Abstract Details

2010, PHD, Kent State University, College of Business and Entrepreneurship, Ambassador Crawford / Department of Finance.
We develop a new social trust index from the World Value Survey. Applying the newly developed social trust index across countries, we investigate the relationship between social trust and various financial development proxies. We find that the social trust index can be improved when we use the composite approach. We find that social trust can explain variations of private credit, private bond, and stock market valuation as a percentage of GDP. We also apply the newly developed social trust index in investigating the ownership concentration and ultimate state ownership. Higher social trust reduces ownership concentration. We also apply the theory proposed by Stulz (2005) and find that state ownership is more dominant where social trust is low. The evidence suggests that social trust is a determining factor of controlling state ownership. Using the trust factor developed in the first essay, we investigate how the trust level of each country affects disclosure of information. Furthermore, we test how social trust plays a role in determining the level of moral hazard of banks. We find that social trust is a positive and significant factor in determining banks’ disclosure across countries. We also find that social trust has a negative impact on moral hazard index across countries, implying that social trust reduces cross national banks’ moral hazard activities. Results are robust.
Raj Aggarwal (Committee Co-Chair)
John Thonton (Committee Co-Chair)
Michael Ellis (Committee Member)
144 p.
Finance
trust; financial development; ownership concentration; state ownship; banks' disclosure; banks' moral hazard

Recommended Citations

Citations

  • Jiao, F. (2010). Essays on Financial Development, Ownership Structure, and Banks’ Disclosure and Moral Hazard Activities: Social Trust Approach [Doctoral dissertation, Kent State University]. OhioLINK Electronic Theses and Dissertations Center. http://rave.ohiolink.edu/etdc/view?acc_num=kent1273455901

    APA Style (7th edition)

  • Jiao, Feng. Essays on Financial Development, Ownership Structure, and Banks’ Disclosure and Moral Hazard Activities: Social Trust Approach. 2010. Kent State University, Doctoral dissertation. OhioLINK Electronic Theses and Dissertations Center, http://rave.ohiolink.edu/etdc/view?acc_num=kent1273455901.

    MLA Style (8th edition)

  • Jiao, Feng. "Essays on Financial Development, Ownership Structure, and Banks’ Disclosure and Moral Hazard Activities: Social Trust Approach." Doctoral dissertation, Kent State University, 2010. http://rave.ohiolink.edu/etdc/view?acc_num=kent1273455901

    Chicago Manual of Style (17th edition)

kent1273455901
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© 2010, all rights reserved.
This open access ETD is published by Kent State University and OhioLINK.