Business Review


Multinomial Asian Financial Crises are said to happen because of financial mismanagement due to post Bretton Woods era financial liberalization, enhancement in private sector debt, currency crises, investor panic as well as inept attitude of the governments in these countries after start of the crises. Since Taiwan is the only country that was not hit as hard as the other countries in the region due to the brunt of these crises we decided to analyze its firm structure to unfold the causes of its survival. Our analysis reveal evidence that manager operated firms finances their growth through external finance without taking into account the profitability of the firm. Contrary to this, the owner operated firms finance their growth from earned profits. This is a possible explanation of why Taiwan was not affected seriously due to 1997 Asian financial crisis because most Taiwanese firms are operated by owners or managers who are loyal to the business of the family.


Owner-controlled firms; Management-controlled firms; Control type; Financial crisis



Journal of Economic Literature Subject Codes

C31, C40, D92

Creative Commons License

Creative Commons Attribution 4.0 International License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Published Online

February 24, 2021



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