Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/212059 
Year of Publication: 
2007
Series/Report no.: 
Bank of Finland Research Discussion Papers No. 1/2007
Publisher: 
Bank of Finland, Helsinki
Abstract: 
Finland experienced an extremely severe economic depression in the early 1990s.In the midst of this crisis, significant new legislation was passed that increased supervisory powers official market regulators and reformed bankruptcy procedures significantly decreasing the protection of creditors.We show that the introduction of these new laws resulted in positive abnormal stock returns.The new laws also lead to increases in firms'Tobin's q, especially for more levered firms.In contrast to previous studies, our results also suggest that public supervision of financial markets fosters rather than hampers financial market development.
Subjects: 
corporate governance
bankruptcy
financial supervision
shareholder protection
creditors' rights
corporate valuations
political economy
JEL: 
G34
K22
Persistent Identifier of the first edition: 
ISBN: 
978-952-462-346-9
Document Type: 
Working Paper

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