The purpose of this study is to investigate the impact of prior year firm’s performance on subsequent year firm’s corporate governance mechanism. We used board size, CEO–Chairman combined structure and audit expenditure as a firm level corporate governance mechanism. The panel data of...

A considerable body of evidence suggests differences between large and small firms in financial and investment behavior. Many observers have taken this evidence to suggest the existence of market imperfections that put small firms at a disadvantage in raising capital. This “market failure”...