Product Market Competition and Internal Governance: Evidence from the Sarbanes–Oxley Act
利用萨班斯-奥克斯利法案作为准自然实验，研究发现产品市场竞争不足时，内部治理机制对企业运营的改善作用更大，尤其对集中行业中治理较弱的公司效果更明显。
We use the Sarbanes–Oxley Act of 2002 (SOX) as a quasi-natural experiment to examine the link between product market competition and internal governance mechanisms. Consistent with the notion that competition plays an important role in aligning incentives within the firm, SOX has led to a larger improvement in the operation of firms in concentrated industries than in nonconcentrated industries. Furthermore, within concentrated industries, the effect is especially pronounced among firms with weaker governance mechanisms prior to SOX. We corroborate these findings using two additional regulatory changes in the United States and abroad. Overall, our results indicate that corporate governance is more important when firms face less product market competition. This paper was accepted by Itay Goldstein, finance.