Summary This paper proposes a micro-level framework to account for how firms in developing economies overcome domestic institutional constraints. It illustrates that the mechanisms enabling those firms to benefit from financial globalization are more complex than the "direct" financial channels...

This paper argues that the deeply rooted cause of poor corporate governance practices in China's state-owned banks is the discretion enjoyed by policy makers to re-optimise their policy choices when they deem necessary and the consequent moral hazard leading to opportunistic behaviours of bank...