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The proposed hypothesis of European corporate governance change is contrasted with existing explanations of corporate governance from a range of academic disciplines. It is argued that, although the hypothesis advanced in the book is based on the rational behavior of social actors, it is not assumed that corporate governance outcomes will necessarily converge on the most “efficient” outcome (e.g., in terms of minimizing the cost of capital for the firm). Nor is it assumed that there is a necessary equality between de jure and de facto corporate governance outcomes (as argued by many legal scholars).

This chapter studies the economic, political, and institutional determinants of privatization. The analysis begins with a discussion of the link between privatization and economic development, then it studies the role of government’s budget constraints, showing how public finance conditions may bear on the decision to privatize. The chapter then focuses on the role of financial markets and governments’ political orientation in triggering divestiture. Finally, it takes into account institutional aspects, such as a country’s legal tradition, and political regimes. The various hypotheses are discussed sequentially. Their empirical validity, however, is assessed through an original panel data econometric analysis.

The payment of dividends by firms remains a quandary for finance scholars because of tax implications for value and the near substitutability of repurchases. A review of the literature on international dividend policy does not suggest an answer to this paradox, but it does provide evidence that supports several important conclusions. First, the evidence fails to support a dominant explanation for why firms pay dividends. Rather, the existing empirical work suggests that there are elements of numerous theories present in the global payment of dividends. Second, the literature shows that what are often presented as stylized facts about dividends are really U.S. results and fail to hold for other countries. Finally, the literature reveals the importance of factors beyond the economic and financial on the design of corporate dividend policies. Increasingly, the empirical evidence shows that cultural, legal, and behavioral factors exert important influences on managerial decisions about dividends.

What is the relationship between law and development in the post-colonial era? Are particular types of legal institutions associated with particular modes of economic organization or trajectories of economic development? Is the relationship between law and development causal, in the sense that specific legal reforms cause specific development outcomes? Not of merely academic interest, these questions have major implications for policy-makers. This chapter traces the history of ideas about these topics, from Max Weber and his successors to proponents of the “right to development.” It identifies key limitations in the intellectual frameworks that have been dominant through the turn of the twenty-first century. Those limitations include: failure to draw upon the experience of countries in the global South; misplaced reliance upon problematic conceptual dichotomies—legal/non-legal, public/private, common law/civil law, and domestic/international; and failure to acknowledge the complexity and mutability of legal institutions. We conclude by examining emerging approaches that promise to overcome some of these limitations.

A number of literatures have addressed the role of small jurisdictions in cross-border finance, or spoken generally to the market terrain they inhabit. This chapter discusses a number of theoretical frameworks, evaluating their capacity to account for the range of small jurisdictions achieving market dominance in cross-border finance. It begins with the globalization literature and then turns to various characterizations applied to small jurisdictions, including tax havens, offshore financial centers, microstates, and global cities. Finally, the chapter assesses the English legal origins of many such jurisdictions. Bruner concludes that none of these theoretical frameworks can accommodate the range of salient features exhibited by those small jurisdictions achieving global dominance in cross-border finance. Each, however, offers important insights contributing to the alternative framework developed in this book.

Family-controlled pyramidal business groups were important in Canada early in the twentieth century, amid rapid catch-up industrialization, but largely gave way to widely held freestanding firms by mid-century. In the 1970s and early 1980s—an era of high inflation, financial reversal, unprecedented state intervention, and explicit emulation of continental European institutions—pyramidal groups abruptly regained prominence. The largest of these were politically well-connected and highly leveraged. The two largest collapsed in the early 1990s in a recession characterized by very high real interest rates. The smaller groups that survived were more vertically integrated and less diversified at the time. Widely held freestanding firms and Anglo-Saxon concepts of the role of the state soon regained predominance.