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Corporate law and governance

Becht, Marco; Bolton, Patrick; Röell, Ailsa

This chapter surveys the theoretical and empirical research on the main mechanisms of corporate law and governance, discusses the main legal and regulatory institutions in different countries, and examines the comparative governance literature. Corporate governance is concerned with the reconciliation of conflicts of interest between various corporate claimholders and the resolution of collective action problems among dispersed investors. A fundamental dilemma of corporate governance emerges from this overview: large shareholder intervention needs to be regulated to guarantee better small investor protection; but this may increase managerial discretion and scope for abuse. Alternative methods of limiting abuse have yet to be proven effective.

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Also Published In

Title
Handbook of law and economics, vol. 2
Publisher
Elsevier
DOI
https://doi.org/10.1016/S1574-0730(07)02012-9

More About This Work

Academic Units
Business
Published Here
December 23, 2010

Notes

Chapter 12