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We provide an institutional theory perspective to examine societal legitimacy in the context of capital market development. While prior research has focused on the importance of formal institutions, firms are embedded within broader socio-economic structures associated with informal institutions. Using content analysis and a unique dataset of 3244 newspaper articles between 2004 and 2013, we develop a dynamic measure capturing the public perception of capital markets as a proxy of informal institutions. We run a Prais–Winsten regression with panel-corrected standard errors to explore the dynamic relationship between public perception of capital markets and equity market size in Austria and Poland. We further theoretically and empirically explore how formal and informal institutions mutually reinforce each other in the context of capital market development. Our results suggest that informal institutions matter differently in developed and emerging economies.

With regrets and deepest sadness we have to announce the passing away of our colleague and co-editor Engelbert Dockner. Professor Dockner was member of the editorial team of Management Review Quarterly (formerly: Journal für Betriebswirtschaft) from 2011 to 2017, and processed manuscripts in the journal's Finance, Tax and Accounting section. Together with Engelbert Dockner, the MRQ experiences its transformation from the Journal für Betriebswirtschaft into an initially bilingual journal, which meanwhile publishes most of its state-of-the-field review articles in English language.

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