Title

Media ownership, concentration and corruption in bank lending

Document Type

Journal article

Source Publication

Journal of Financial Economics

Publication Date

5-1-2011

Volume

100

Issue

2

First Page

326

Last Page

350

Keywords

Bank lending, Bank supervision, Corruption, Media concentration, Ownership

Abstract

Building on the pioneering study by Beck, Demirguc-Kunt, and Levine (2006), this study examines the effects of media ownership and concentration on corruption in bank lending using a unique World Bank data set covering more than 5,000 firms across 59 countries. We find strong evidence that state ownership of media is associated with higher levels of bank corruption. We also find that media concentration increases corruption both directly and indirectly through its interaction with media state ownership. In addition, we find that media state ownership and media concentration both accentuate the positive link between official supervisory power and lending corruption and attenuate the negative link between the regulations that empower private monitoring and corruption in lending. Media state ownership or media concentration also accentuates the positive link between banking concentration and corruption in lending. Furthermore, the links between media structure and corruption are more pronounced when the borrowing firm is privately owned.

DOI

10.1016/j.jfineco.2010.12.003

Print ISSN

0304405X

Publisher Statement

Copyright © 2010 Elsevier B.V.

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Full-text Version

Publisher’s Version

Recommended Citation

Houston, J. F., Lin, C., & Ma, Y. (2011). Media ownership, concentration and corruption in bank lending. Journal of Financial Economics, 100(2), 326-350. doi: 10.1016/j.jfineco.2010.12.003