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Law and Finance*

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Author

Listed:
  • Rafael La Porta
  • Florencio Lopez-de-Silanes
  • Andrei Shleifer
  • Robert W. Vishny

Abstract

This paper examines legal rules covering protection of corporate shareholders and creditors, the origin of these rules, and the quality of their enforcement in 49 countries. The results show that common†law countries generally have the strongest, and french civil law countries the weakest, legal protections of investors, with German†-and Scandinavian†-civil†law countries located in the middle. We also find that concentration of ownership of shares in the largest public companies is negatively related to investor protections, consistent with the hypothesis that small, diversified share†holders are unlikely to be important in countries that fail to protect their rights.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert W. Vishny, 1998. "Law and Finance," Journal of Political Economy, University of Chicago Press, vol. 106(6), pages 1113-1155, December.
  • Handle: RePEc:ucp:jpolec:v:106:y:1998:i:6:p:1113-1155
    DOI: 10.1086/250042
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    References listed on IDEAS

    as
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    8. Morck, Randall & Shleifer, Andrei & Vishny, Robert W., 1988. "Management ownership and market valuation," Scholarly Articles 29407535, Harvard University Department of Economics.
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    10. Levine, Ross, 1998. "The Legal Environment, Banks, and Long-Run Economic Growth," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 30(3), pages 596-613, August.
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    Replication

    This item has been replicated by:
  • Holger Spamann, 2010. "The "Antidirector Rights Index" Revisited," Review of Financial Studies, Society for Financial Studies, vol. 23(2), pages 467-486, February.
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