Based on a unified database of 7,740 publicly traded corporations across 22 Asian and
European countries, our study provides new evidence on the role of legal and extra-legal
institutions in determining the separation of ownership and control (excess control). As
predicted by theory, we find that a higher level of excess control-hence, a greater incentive
to expropriate minority shareholders-is associated with less developed legal systems and
weaker extra-legal institutions. Indeed, the level of excess control is lower in countries with …