Family control and expropriation at not-for-profit organizations: evidence from korean private universities

Kee-Hong Bae, Seung-Bo Kim and Woochan Kim

MPRA Paper from University Library of Munich, Germany

Abstract: We study an agency problem in private universities — the conflict between controlling families and other stakeholders. We investigate whether universities over which controlling families have disproportionately significant power relative to the amount of funds they contribute, that is, universities with high expropriation risk, are associated with lower outside donations and poor quality. Using a sample of Korean private universities, we find that measures of family control in excess of monetary contributions are negatively related to the level of outside donation and measures of university quality. We also find that universities at which the controlling family exerts disproportionate control are more likely to face disputes between the controlling family and other stakeholders. Finally, we show that our results are not driven by reverse causality.

Keywords: Corporate Governance; Non-profits; Expropriation; Donations; Private University (search for similar items in EconPapers)
JEL-codes: G34 I22 L30 (search for similar items in EconPapers)
Date: 2012-03-01
New Economics Papers: this item is included in nep-edu
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Citations: View citations in EconPapers (2)

Published in Corporate Governance: An International Review 20.4(2012): pp. 388-404

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:44029

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