López-de-Silanes, FlorencioChong, Alberto2012-05-312012-05-312007978-0-8213-6913-5https://hdl.handle.net/10986/6769This book holds that the crucial failure of corporate governance is the expropriation of outside investors, be they shareholders or creditors, by those who are in control of firms. The problem of expropriation, also known as tunneling, often takes on enormous proportions. Billions of dollars of wealth are siphoned away from outside investors to controlling shareholders and their private company allies. The expropriation prevents investors from devoting funds in the corporate sector, thus leading to low valuations of corporate assets, stunted capital markets, and slowed economic growth. Low valuations and underdeveloped financial markets are only two of the symptoms of investor expropriation. Other symptoms include concentrated corporate ownership, large spreads between cash flow ownership and the voting rights of dominant shareholders, pyramids, and low dividend payments. When financial markets exhibit these symptoms, the likely underlying problem is investor expropriation. The essays collected in this volume put together a compelling picture showing that many of the symptoms of investor expropriation and poor corporate governance are present in Latin America. The evidence is loud and clear in every chapter of this book. But there are also benefits to collecting this detailed proof. The evidence suggests recipes for improvement as well. The message of this book is as unambiguous as is its analysis: a critical goal in the agenda of financial reform in Latin America must be improvement in corporate governance through legal reform.en-USCC BY-NC-ND 3.0 IGOACCESS TO CAPITALACCESS TO CAPITAL MARKETSACCOUNTINGACCOUNTING STANDARDSACTIVE MARKETSADRAGENCY COSTSAGENCY PROBLEMSAUDIT COMMITTEESBALANCE SHEETBANKRUPTCYBANKRUPTCY LAWBOOK VALUECAPITAL FLIGHTCAPITAL FLOWSCAPITAL MARKETCAPITAL MARKETSCAPITAL STRUCTURECASH DIVIDENDSCASH FLOWCASH FLOWSCHECKSCIVIL LAWCOMMERCIAL LAWSCOMMON LAWCOMPANY LAWSCOMPETITIVE BIDDINGCONFLICTS OF INTERESTCONFLICTS OF INTERESTSCOPYRIGHT CLEARANCECOPYRIGHT CLEARANCE CENTERCORPORATE CHARTERSCORPORATE DISCLOSURECORPORATE GOVERNANCECORPORATE GOVERNANCE REFORMCORPORATE INSIDERSCORPORATE LAWCORPORATE OWNERSHIPCOST OF CAPITALCREDITORCREDITOR RIGHTSCREDITORSCURRENCYCURRENCY DEVALUATIONSDEBTDEBTORSDEMOCRACYDEPENDENTDEPOSITARY RECEIPTDEPOSITARY RECEIPTSDEVELOPING ECONOMIESDEVELOPMENT BANKDIRECT OWNERSHIPDISCLOSURE REQUIREMENTSDISCLOSURE STANDARDSDISPUTE RESOLUTIONDIVIDENDDIVIDEND PAYMENTSDIVIDEND PAYOUTDIVIDEND POLICIESECONOMIC IMBALANCESEMERGING MARKETEMERGING MARKETSENFORCEMENT MECHANISMSENFORCEMENT OF LAWSEQUITY FINANCINGEQUITY FIRMEQUITY MARKETSEXPROPRIATIONEXPROPRIATIONSEXTERNAL FINANCEEXTERNAL FINANCINGFINANCIAL ANALYSISFINANCIAL CONTRACTSFINANCIAL CRISESFINANCIAL DEVELOPMENTFINANCIAL INFORMATIONFINANCIAL MARKETFINANCIAL MARKET DEVELOPMENTFINANCIAL MARKETSFINANCIAL PROBLEMSFINANCIAL REFORMFINANCIAL STABILITYFINANCIAL SUPPORTFIRM VALUATIONFIRM-LEVEL CORPORATE GOVERNANCEFOREIGN COMPANIESFOREIGN EXCHANGESFOREIGN INVESTORSFREE TRADEFREE TRADE AGREEMENTGLOBAL MARKETGOVERNANCE INDEXGOVERNANCE MEASUREGOVERNANCE MEASURESGOVERNANCE MECHANISMSGOVERNANCE PRACTICESGOVERNANCE STRUCTURESGOVERNMENT DEFICITSGRANT FUNDINGGROSS DOMESTIC PRODUCTGROSS NATIONAL PRODUCTGROWTH RATEHOME MARKETINCOMEINITIAL PUBLIC OFFERINGINSIDER TRADINGINSTITUTIONAL ENVIRONMENTINSTITUTIONAL FRAMEWORKINSTITUTIONAL INVESTORSINSTITUTIONAL REFORMINSURANCEINTEREST RATEINTERNATIONAL BANKINTERNATIONAL MARKETSINVESTOR PROTECTIONIPOISSUANCEJUDGEMENTJUDICIAL SYSTEMLAW ENFORCEMENTLEGAL ENFORCEMENTLEGAL JURISDICTIONSLEGAL ORIGINLEGAL ORIGINSLEGAL PROTECTIONLEGAL REFORMLEGAL REFORMSLEGAL SYSTEMLEVERAGELIABILITYLIQUIDITYLOCAL MARKETSLOW-INCOME COUNTRIESMACROECONOMIC ENVIRONMENTMACROECONOMIC INSTABILITYMACROECONOMIC STABILITYMACROECONOMIC VARIABLESMARKET CAPITALIZATIONMARKET INTEGRATIONMARKET LAWMARKET MECHANISMSMARKET PARTICIPANTSMARKET PERFORMANCEMARKET REGULATORMARKET REGULATORSMARKET VALUATIONMARKET VALUEMINORITY INVESTORSMINORITY SHAREHOLDERSNATIONAL SECURITIESNET CAPITALOUTPUTOUTSIDE INVESTORSOWNERSHIP STRUCTUREOWNERSHIP STRUCTURESPAYMENT OF DIVIDENDSPAYOUT RATIOSPERFORMANCE MEASURESPOLITICAL RISKPOLITICAL STABILITYPREEMPTIVE RIGHTSPRIVATE CREDITPRIVATE ENFORCEMENTPRIVATE SECTOR DEVELOPMENTPROPORTIONAL REPRESENTATIONPROTECTION OF INVESTORSPROTECTION TO INVESTORSPROXY BY MAILPUBLIC ENFORCEMENTPUBLIC OFFERINGSPUBLIC POLICYREGULATORY ENVIRONMENTREPUTATIONREPUTATIONSRETURNRETURN ON ASSETSRETURNSRISK OF CONTRACT REPUDIATIONRISK OF EXPROPRIATIONRULE OF LAWSAVINGSSCANDALSSECURITIESSECURITIES LAWSECURITIES LAWSSECURITIES REGULATIONSSECURITY MARKETSHAREHOLDERSHAREHOLDER PROTECTIONSHAREHOLDER PROTECTIONSSHAREHOLDER RIGHTSSHAREHOLDERSSOCIAL DEVELOPMENTSOCIAL ISSUESSTOCK EXCHANGESTOCK EXCHANGESSTOCK MARKETSTOCK MARKET CAPITALIZATIONSTOCK MARKET DEVELOPMENTSTOCK MARKETSSTOCK TRADINGSTOCKSTRADING ACTIVITYTRADING VALUETRADING VOLUMETRANSACTIONTRANSPARENCYTURNOVERTURNOVERSUNDERWRITERSVALUATIONVALUATIONSInter-American Development Bank10.1596/978-0-8213-6913-5