Fresh prospects are opening for asset managers as Europe seeks to reduce its historical reliance on banking and to promote capital markets. But following the financial crisis, the industry faces a dual challenge: regaining investors' trust and coping with the post-crisis regulatory reform. Much...

Using objective measures of investor protections in 170 countries, I establish that the level of investor protection matters for cross-country differences in GDP growth: countries with stronger protections tend to grow faster than those with poor investor protections

Using objective measures of investor protections in 170 countries, I establish that the level of investor protection matters for cross-country differences in GDP growth: countries with stronger protections tend to grow faster than those with poor investor protections

We develop a model to illustrate that controlling shareholders choose the level of investor protection that maximizes their own interests. Controlling shareholders in companies with complicated control structures can easily extract private benefits and are thus reluctant to enhance investor...