BIBLIOGRAPHY

Acemoglu, D., Johnson, S., and Robinson, J. 2001. The colonial origins of comparative development: An empirical study. American Economic Review 91, 1369–1401.

Adama, N. 1980. L’État c’est nous. Euromoney (October), 110.

Alchian, A., and Demsetz, H. 1972. Production, information costs and economic organization. American Economic Review 62, 777–795.

Aleotti, A. 1990. Borsa e industria, 1861–1989: Gnto omni de rapporti difficuli. Milan: Edizioni Comunita.

Allen, F. 1993. Stock markets and resource allocation. In Mayer, C., and Vives, X. (Eds.), Capital markets and financial intermediation. Cambridge: Cambridge University Press.

Allen, R. 1992. Enclosure and the yeoman: The agricultural development of the south midlands, 1450–1850. Oxford: Clarendon Press.

Alston, L. 1984. Farm foreclosure moratorium legislation: A lesson from the past. American Economic Review 74, 445–458.

American Iron and Steel Industry, “The New Steel Industry,” www.steel.org/facts/ power/newsteel.htm.

American Iron and Steel Industry: 1997. Annual Statistical Report.

Anonymous. 1996. Founding dates of the 1994 Fortune 500 U.S. companies. Business History Review 70, no. 1, 69–90.

Anonymous. 2000. “The Knowledge of Monopolies: Patent Wars.” Economist, 8 April, 76.

Anonymous. 2001. Market says no to UniCredito-Commerz Alliance. Il Corriere della Sera (Italian), 4 September.

Anonymous. 2001. Borsa: UniCredito (+5.9%) strappa dopo rottura trattative Commerzbank. AFX News Limited, 11 September.

Anonymous. 2002. Anger over steel. The Economist Global Agenda, 11 March.

Anonymous. 2002. “Romancing big steel.” Economist 362 (16 February), 52.

Aoki, M., Patrick, H., and Sheard, P. 1994. The Japanese main bank system: An overview. In Aoki, M., Patrick, H. (Eds.), The Japanese main bank system. New York: Oxford University Press.

Audretsch, D. B., Caree, M. A., van Stel, A. J., and Thurik, A. R. 2001. Impeded industrial restructuring: the growth penalty. Unpublished research paper. Bloomington, Ind.: Institute for Development Strategies.

Audretsch, D. B., and Thurik, A. R. 2000. What’s new about the new economy? Sources of growth in the managed and entrepreneurial economies. Discussion paper 44. Rotterdam: Erasmus Research Institute of Management.

Baer, J. 2000. Plans for Palm, buyback help boost 3Com shares. Chicago Sun-Times, 10 May, 27.

Baker, G. 1992. Beatrice: A study in the creation and destruction of value. The Journal of Finance 47, 1081–1120.

Banerjee, A., and Iyer, L. 2002. History, Institutions and Economic Performance: The Legacy of Colonial Land Tenure Systems in India. Unpublished working paper, Cambridge, Mass.: MIT.

Barber, M., 1994. The new knighthood: A history of the order of the temple. London: Cambridge University Press.

Barber, T. 2001. UniCredito concerned over share price fall. Financial Times (London) 10 September, 27.

Barca, F., and Trento, S. 1997. La parabola delle partecipazioni statali: Una missione tradita. In Barca, F. (Ed.), Storia del Capitalismo Italiano. Rome: Donzelli.

Barker, D. 1992. The fetal origins of adult hypertension. Journal of Hypertension Supplement 10, S39–44.

Barker, D. 1994. Maternal and fetal origins of coronary heart disease. Journal of the Royal College of Physicians 28, 544–551.

Barker, D. 1998. In utero programming of chronic disease. Clinical Science 95, 115–128.

Barr, N. 2001. The welfare state as piggy bank: Information, risk, uncertainty, and the role of the state. Oxford: Oxford University Press.

Beaudry, P., and Green, D. 2002. Changes in U.S. wages 1976–2000: Ongoing skill bias or major technological change? Working paper 8787. Cambridge, Mass.: National Bureau of Economic Research.

Bebchuk, L., and Roe, M. J. 1999. A theory of path dependence in corporate ownership and governance. Stanford Law Review 52, 127–170.

Becker, G. 1983. A theory of competition among pressure groups for political influence. Quarterly Journal of Economics 98, 371–400.

Bell, D. 1999. The coming of post-industrial society. New York: Basic Books.

Benston, G. 1990. The separation of commercial and investment banking: The Glass-Steagall Act revisited and reconsidered. Oxford: Oxford University Press.

Benston, G. 1994. The origins and justification for the Glass-Steagall Act. In Saunders, A., and Walter, I. (Eds.), Universal banking in the United States: What could we gain? (pp. 31–69). New York: Oxford University Press.

Berger, A., Miller, N., Petersen, M., Rajan, R., and Stein, J. 2002. Does function follow organizational form? Evidence from the lending practices of large and small banks. Working paper 8752. Cambridge, Mass.: NBER.

Berglof, E., and Rosenthal, H. 1999. The political economy of American bankruptcy: The evidence for roll-call voting, 1800–1978. Working paper on political economy. Cambridge, Mass.: MIT.

Bernstein, E. M., and Patel, I. G. 1953. Inflation and economic development. Unpublished staff paper. Washington, DC: International Monetary Fund.

Besanko, D., and Thakor, A. V. 1987. Collateral and rationing: Sorting equilibria in monopolistic and competitive credit markets. International Economic Review 28, 671–689.

Bhagwati, J. 2002. Free trade today. Princeton, N.J.: Princeton University Press.

Bhattacharya, U., and Daouk, H. 2002. The world price of insider trading. Journal of Finance 57, 75–108.

Bhattacharya, U., Daouk, H., and Welker, M. 2002. The world price of earnings opacity. Working paper. Bloomington, Ind.: Indiana University.

Bhide, A. V. 2000. Origin and evolution of new business. New York: Oxford University Press.

Black, B. 2000. Does corporate governance matter? A crude test using Russian data. University of Pennsylvania Law Review 149, 2131–2150.

Black, B. and Gilson, R. 1998. Venture capital and the structure of capital markets: Banks versus stock markets. Journal of Financial Economics 47, 243–277.

Black, S., and Strahan, P. 2001. The division of spoils: Rent-sharing and discrimination in a regulated industry. American Economic Review 91, 814–831.

Black, S., and Strahan, P. 2002. Entrepreneurship and bank credit availability. Journal of Finance (forthcoming).

Blanchard, O. J., Lopez-de-Silanes, F., and Shleifer, A. 1994. What do firms do with cash windfalls? Journal of Financial Economics 36, 337–360.

Blanchard, O., Rhee, C., and Summers, L. 1990. The stock market, profit, and investments. Quarterly Journal of Economics 108, 115–137.

Blau, D. 1987. A time series analysis of self-employment in the United States. Journal of Political Economy 95, 445–468.

Blume, M., Siegel, J., and Rottenberg, D. 1993. For the revolution on Wall Street: The rise and decline of the New York Stock Exchange. New York: Norton.

Blumenstein, R., and Warner, F. 1998. GM to make Delphi unit independent. Wall Street Journal, 4 August, A3.

Borgatta, G. 1937. La politica monetaria nel sistema corporativo. Annali di Economica 12, 257.

Boycko, M., Shleifer, A., and Vishny, R. 1995. Privatizing Russia. Cambridge, Mass.: MIT.

Brandeis, L. D. 1922. Letter to Robert W. Bruere. Columbia Law Review 31, 7.

Brandeis, L. D. 1933. Other people’s money. Washington, DC: National Home Library Foundation.

Breen, D. A. 1977. The monopoly value of households-goods carrier certificates. Journal of Law and Economics 20, 153–185.

Brenner, R. 1985. Agrarian class structure and economic development. In Aston, T. H., and Philipin, C. H. E. (Eds.), The Brenner debate. Cambridge: Cambridge University Press.

Bureau of Labor Statistics. National Current Employment Statistics, www.bls.gov/webapps/legacy/cesbtabl.htm.

Bynjolfson, E., Malone, T. W., Gurbaxani, V., and Kambil, A. 1994. The impact of the modern corporation. New York: Columbia University Press.

Cameron, R. 1961. France and the economic development of Europe, 1800–1914. Princeton, N.J.: Princeton University Press.

Cameron, R. 1967. Banking in the early stages of industrialization. London: Oxford University Press.

Canan, E. 1976. The wealth of nations (Book 1, Chapters 10 and 11). Chicago: University of Chicago Press.

Caree, M., van Stel, A., Thurik, R., and Wennekers, S. 2000. Economic development and business ownership: an analysis using data of 23 OECD countries in the period 1976–1996. Small Business Economics 19, no. 3 (November), 271–290.

Carlsson, B. 1989. The evolution of manufacturing technology and its impact on industrial structure: An international study. Small Business Economics 1, 21–37.

Carlsson, B. 1992. The rise of small business: Causes and consequences. In Adams, W. J. (Ed.), Singular Europe, economy and policy of the European community after 1992. Ann Arbor, Mich.: University of Michigan Press, 145–169.

Carlsson, B. 1999. Small business, entrepreneurship, and industrial dynamics. In Acs, Z. (Ed.), Are small firms important? Their role and impact. Dordrecht: Kluwer Academic Publishers, 99–110.

Carroll, P. 1993. Big blues: The unmaking of IBM. New York: Crown Publishing.

Carruthers, B. 1996. City of capital: Politics and markets in the English financial revolution. Princeton, N.J.: Princeton University Press.

Chan, Y. S., and Thakor, A. V. 1987. Collateral and competitive equilibria with moral hazard and private information. Journal of Finance 42, 345–364.

Chandler, A. 1990. Scale and scope: The dynamics of industrial capitalism. Cambridge, Mass.: Belknap Press.

Chari, A., and Henry, P. 2001. Does diversification drive stock price revaluation? Research paper 1677. Stanford, Calif.: Stanford University.

Chernow, R. 1998. Titan: The life of John D. Rockefeller. New York: Random House.

Chevalier, J., and Ellison, G. 1997. Risk-taking by mutual funds as a response to incentives. Journal of Political Economy 105, no. 6, 1167–1200.

Chew, L. “Not just one man—Barings.” Case study. International Financial Risk Institute. http://risk.ifci.ch/137550.htm.

Chiuri, M., and Jappelli, T. 2001. Credit market imperfections and home ownership: A comparative study. Discussion paper 2717. London: CEPR.

Christensen, C. 1997. The innovators’ dilemma: When new technologies cause great firms to fail. Boston: Harvard Business School Press.

Clark, G. 1991. Yields per acre in English agriculture, 1250–1860: Evidence from labor inputs. Economic History Review 44, 445–460.

Clay, C. G. A. 1984. Economic Expansion and Social Change: England 1500–1700. Cambridge: Cambridge University Press, p. 70.

Clay, D. 2001. The role of institutional investors. Ph.D. dissertation. Chicago: University of Chicago Graduate School of Business.

Colajanni, N. 1991. Il Capitalismo Senza Capitale. Milan: Sperling and Kupfer, 64.

Collat, D., and Tufano, P. 1994. The privatization of Rhone-Poulenc. Case 9–295–049. Boston: Harvard Business School.

Cornell, B., and Liu, Q. 2001. The parent company puzzle? When is the whole worth less than one of the parts? Journal of Corporate Finance 7, no. 4, 341–366.

Coulton, G. G. 1925. The mediaeval village. Cambridge: Cambridge University Press.

Council of Economic Advisers. 1998. Economic Report of the President. Washington, DC: United States Government Printing Office.

Council of Economic Advisers. 2001. Economic Report of the President. Washington, DC: United States Government Printing Office.

Council of Economic Advisers. 2002. Economic Report of the President. Washington, DC: United States Government Printing Office, Table B-77, 412.

Council of Economic Advisers. 2002. The United States in the international economy. Economic Report of the President. Washington, DC: United States Government Printing Office, 261.

Davis, S., and Haltiwanger, J. 1989. The distribution of employees by establishment size: Patterns of change and comovement in the United States, 1962–85. Unpublished working paper. Chicago: University of Chicago.

De Cecco, M. 1968. Saggi di Politica Monetaria. Milan: Giuffrre.

De Cecco, M., and Ferri, G. 1996. Le Banche D’Affari in Italia. Bologna: II Mulino.

Demirguc-Kunt, A., and Detragiache, E. 1998. Financial liberalization and financial fragility. Working paper #1917. Washington, DC: World Bank Group.

Demsetz, R. 1997. Human resources needs in the evolving financial sector. Current Issues in Economics and Finance (Federal Reserve Bank of New York) 3 no. 13, 1–6.

De Soto, H. 2000. The mystery of capital: Why capitalism triumphs in the West and fails everywhere else. New York: Basic Books.

Diamond, D., and Rajan, R. 2001. Liquidity risk, liquidity creation and financial fragility: A theory of banking. Journal of Political Economy 109, 287–327.

Dietz, F. 1942. An economic history of England. New York: Henry Holt and Company.

Djankov, S., La Porta, R., Lopez-de-Silanes, F., and Shleifer, A. 2000. The regulation of entry. Working paper 7892. Cambridge, Mass.: NBER.

Domowitz, I., and Tamer, E. 1997. Two hundred years of bankruptcy: A tale of legislation and economic fluctuations. Unpublished working paper. Evanston, Ill.: Northwestern University Institute for Policy Research.

Donnelly, B., and Sesit, M. 1990. U.S. bears bets may roil Japan’s turmoil. Wall Street Journal, 17 April, C1.

Dosi, G. 1988. Sources, procedures and microeconomic effects of innovation. Journal of Economic Literature 26, 1120–1171.

Downs, A. 1957. An economic theory of democracy. New York: Harper & Brothers.

Dyck, A., and Zingales, L. Cambridge, Mass.: 2002. Private benefits of control: An international comparison. Working paper 8711. Cambridge, Mass.: NBER.

Ehrenberg, R. 1928. Capital and finance in the age of the renaissance: A study of the fuggers and their connections. New York: Harcourt.

Eichengreen, B. J. 1996. Globalizing capital: A history of the international monetary system. Princeton, N.J.: Princeton University Press.

Emerson, R. 1963. Power dependence relations. American Sociological Review 27, 31–41.

Fabbri, D., Padula, M. 2001. Judicial costs and household debt. Unpublished working paper. Salerno: Center for Studies in Economics and Finance, University of Salerno.

Fama, E. 1971. Risk, return, and equilibrium. Journal of Political Economy 79, no. 1, 30–57.

Fama, E. 1991. Efficient capital markets II. Journal of Finance 46 no. 5, 1575–1617.

Fear, J. 1997. German capitalism. In McCraw, T. (Ed.), Creating modern capitalism: How entrepreneurs, companies, and countries triumphed in three industrial revolutions (p. 181). Cambridge, Mass.: Harvard University Press.

Feinstein, C. H., Temin, P., and Toniolo, G. 1997. The European economy between the wars. New York: Oxford University Press.

Ferguson, N. 1999. The house of Rothschild: The world’s banker 1849–1999. New York: Viking.

Ferri, G., and Trento, S. 1997. La dirigenza delle grandi bancje e delle grandi imprese: Ricambio e legami. In Barca, F. (Ed.), Storia del Capitalismo Italiano. Rome: Donzelli.

Finer, S. E. 1997. The history of government III. London: Oxford University Press. 1271, 1325, and 1338.

Fischel, D. 1995. Payback: The conspiracy to destroy Michael Milken and his financial revolution. New York: HarperCollins.

Flanagan, C. S. 2001. Search fund study—2001. Stanford, Calif.: Stanford Business School Center for Entrepreneurial Studies.

Fogel, R. W. 2000. The fourth great awakening and the future of egalitarianism. Chicago: University of Chicago Press.

Franks, J., and Mayer, C. 1998. Bank control, takeovers and corporate governance in Germany. Journal of Banking and Finance 22, 1231–1480.

Freeman, R., and Oostendorop, R. 2000. Occupational wages around the world database. Cambridge, Mass.: NBER (www.nber.org/oww).

Friedman, T. 1999. The Lexus and the olive tree. New York: Farrar, Straus, and Giroux.

Froot, K. 2001. The market for catastrophic risk: A clinical examination. Working paper 8110. Cambridge, Mass.: NBER.

Froot, K., and Daboora, E. 1999. How are stock prices affected by the location of trade. Journal of Financial Economics 53, 189–216.

Fukuyama, F. 1992. The end of history and the last man. New York: Free Press.

Galli, G. 1995. II Padrone Dei Padroni. Milan: Garzanti, Milano.

George, N. 2001. Sonera abandons 3G plans and returns license. Financial Times, 10 August.

Glaeser, E., Johnson, S., and Shleifer, A. 2001. Coase vs. the Coasians. Quarterly Journal of Economics 116, 853–899.

Goldin, C., and Katz, L. 1999. The returns to skill in the United States across the twentieth century. Working paper 7126. Cambridge, Mass.: NBER.

Goldsmith, R. 1969. Financial structure and development. New Haven, Conn.: Yale University Press.

Gompers, P. 1995. Optimal investment, monitoring, and the staging of venture capital. Journal of Finance 50, 1461–1490.

Gompers, P. 1996. Grandstanding in the venture capital industry. Journal of Financial Economics 42, 133–156.

Gompers, P., and Metrick, A. 2001. Institutional investors and equity prices. Quarterly Journal of Economics 116, 229–260.

Gorman, M., and Sahlman, W. 1989. What do venture capitalists do? Journal of Business Venturing 4, 231–248.

Gourevitch, P. 1986. Politics in hard times: Comparative responses to international economic crises. Ithaca N. Y.: Cornell University Press.

Gropp, R., Scholz, J., and White, M. 1997. Personal bankruptcy and credit supply and demand. Quarterly Journal of Economics 112, 217–251.

Grossman, S., and Hart, O. 1986. The costs and benefits of ownership: A theory of vertical and lateral integration. Journal of Political Economy 94, 691–719.

Grossman, S., and Stiglitz, J. 1980. On the impossibility of informationally efficient markets. American Economic Review 70, 393–408.

Guiso, L., Sapienza, P., and Zingales, L. 2002. Does local financial development matter? Working paper 8923. Cambridge, Mass.: NBER.

Guiso, L., and Zingales, L. 1999. The rise of bank relationships. Unpublished working paper. Chicago: The University of Chicago Graduate School of Business.

Habakkuk, H. J. 1987. The market for monastic property, 1539–1603. Economic History Review 10, 362–380.

Haber, S. 1991. Industrial concentration and the capital markets: A comparative study of Brazil, Mexico, and the United States. Journal of Economic History 51, 559–580.

Haber, S. 1997. How Latin America fell behind: Essays on the economic histories of Brazil and Mexico, 1800–1914. Stanford, Calif.: Stanford University Press.

Hallam, H. 1876. Constitutional history of England. New York: Harper and Brothers.

Halpern, P., Trebilcock, M., and Turnbull, S. 1980. An economic analysis of limited liability in corporate law. University of Toronto Law Review 117, 30.

Halverson, G. 2002. Time might be right for a hunk of junk. Christian Science Monitor, 11 February, 20.

Hamel, G., and Pralahad, C. 1990. The core competence of the corporation. Harvard Business Review 68, 79–91.

Harvey, C., Lundblad, C., and Bekaert G. 2001. Does financial liberalization spur growth? Working paper 8245, Cambridge, Mass.: NBER.

He, K., Morck, R., and Yeung, B. 2002. Corporate stability and economic growth. Unpublished working paper. New York: New York University.

Helleiner, E. 1994. States and the reemergence of global finance: From Bretton Woods to the 1990’s. Ithaca, N.Y.: Cornell University Press.

Hellwig, M. 2000. Economics and politics of corporate finance and control. In Vives, X. (Ed.), Corporate governance: Theoretical and empirical perspectives (Cambridge: Cambridge University Press. 109).

Henry, P. 2000. Stock market liberalization, economic reform and emerging market equity prices. Journal of Finance 55, 529–564.

Hobsbawm, E. J. 1979. The age of capital 1848–1885. New York: New American Library.

Holmstrom, B. 1999. The firm as a subeconomy. Journal of Law Economics and Organization 15, 74–102.

Holmstrom, B., and Kaplan, S. 2001. Corporate governance and merger activity in the U.S.: Making sense of the 1980s and the 1990s. Journal of Economic Perspectives 15 Cambridge, Mass.: 121–144.

Hoshi, T., and Kashyap, A. 2001. Corporate Finance and Government in Japan. No. 2, MIT Press.

Hunter, L., Bernhardt, A., Hughes, K., and Skuratowicz, E. 2000. It’s not just the ATMs: Technology, firm strategies, jobs, and earnings in retail banking. Working paper. Philadelphia: Wharton Financial Institutions Center.

Huson, M., Parrino, R., and Starks, L. 2001. Internal monitoring mechanisms and CEO turnover: A long-term perspective. Journal of Finance 56 no. 6, 2265–2298.

Ikenson, D. 2002. Steel trap: How subsidies and protectionism weaken the U.S. steel industry. Trade Briefing Paper No. 14. March 1, Washington, DC: Cato Institute, 3, 5.

Irwin, D. 2002. Free trade under fire. Princeton, N.J.: Princeton University Press.

Jackson, T. 1997. Inside Intel: Andy Grove and the rise of the world’s most powerful chip company. New York: Penguin Group.

Jaeger, D., and Stevens, A. 1998. Is job stability in the United States falling? Reconciling trends in the current population survey and panel study of income dynamics. Working paper 6650. Cambridge, Mass.: NBER.

Jeanneau, S. 2002. Derivatives. Bank for International Settlements Quarterly Review, March, 32.

Jappelli, T., Pagano, M., and Bianco, M. 2002. Courts and banks: Effects of judicial enforcement of credit markets. Working paper 3347. London: CEPR.

Jayaratne, J., and Strahan, P. 1996. The finance-growth nexus: Evidence from bank branching deregulation. Quarterly Journal of Economics 111, 639–670.

Jayaratne, J., and Strahan, P. 1998. Entry restrictions, industry evolution, and dynamic efficiency: Evidence from commercial banking. Journal of Law and Economics 41, 239–274.

Jensen, M. C. 1978. Some anomalous evidence regarding market efficiency. Journal of Financial Economics 6, 95–101.

Jensen, M. C. 1986. Agency costs of free cash flow, corporate finance and takeovers. American Economic Review 76, 323–339.

Kaminsky, G., and Reinhart, C. 1999. The twin crises: the causes of banking and balance of payments problems. American Economic Review 89, 473–500.

Kaminsky, G., and Schmukler, S. 2002. Short-run pain, long-run gain: The effects of financial liberalization. Working paper. Washington, DC: The World Bank.

Kaplan, S. N. 1994. Top executive rewards and firm performance: A comparison of Japan and the United States. The Journal of Political Economy 102, 510–546.

Kaplan, S., and Stromberg, P. 2000. How do venture capitalists choose and monitor investments? Unpublished working paper. Chicago: The University of Chicago.

Katz, L., and Murphy, K. 1992. Changes in relative wages, 1963–1987: Supply and demand factors. Quarterly Journal of Economics 107, 33–78.

Kennedy, D. M. 1999. Freedom from fear: The American people in depression and war 1929–45. New York: Oxford University Press.

Kester, C., Lueherman, T. 1992. The myth of Japan’s low cost of capital. Harvard Business Review 70, no. 3, 130–140.

Khanna, T., and Palepu, K. 2000. Is group affiliation profitable in emerging markets? Journal of Finance 55, 867–891.

King, R., and Levine, R. 1993. Finance and growth: Schumpeter might be right. Quarterly Journal of Economics 108, 734.

Kirkpatrick, G. Rural credit in North Carolina. Credit Union National Association (CUNA) Archivist. http://www.cuna.org/data/cu/research/irc/archive4_1.html.

Klapper, L., and Love, I. 2002. Corporate governance, investor protection, and performance in emerging markets. Unpublished working paper. Washington, DC: The World Bank.

Komninos, N. 1994. The effect of information technology on average firm size and the degree of vertical integration in the manufacturing sector. Ph.D. dissertation. Washington, DC: The American University.

Kripalani, M. 2000. Polishing the diamond business. Business Week (international ed.), 11 September, 26.

Kroszner, R., and Rajan, R. G. 1994. Is the Glass-Steagall Act justified? Evidence from the U.S. experience with universal banking, 1921–1933. American Economic Review 84, 810–832.

Kroszner, R., and Rajan, R. G. 1997. Organization structure and credibility: Evidence from the commercial bank securities activities before the Glass-Steagall Act. Journal of Monetary Economics 39, 475–516.

Kroszner, R., and Strahan, P. 1999. What drives deregulation? Economics and politics of the relaxation of bank branching restrictions. Quarterly Journal of Economics 114 no. 4, 1437–1467.

Kukies, J. 2001. Stock markets for high technology firms and venture capital financing: Evidence from Europe. Ph.D. dissertation. Chicago: The University of Chicago Graduate School of Business.

Lamont, O., and Thaler, R. 2000. Can the market add and subtract? Mispricing in tech-stock carve-outs. Unpublished working paper. Chicago: The University of Chicago.

Lamoreaux, N. 1994. Insider lending: Banks, personal connections and economic development in industrial New England. Cambridge: Cambridge University Press.

Landes, D. 1963. A chapter in the financial revolution of the nineteenth century: The rise of French deposit banking. Journal of Economic History 23, 224–231.

Lang, M., Lins, K., and Miller, D. 2002. ADRSs, analysts, and accuracy: Does cross listing in the U.S. improve a firm’s information environment and increase market value? Unpublished working paper. Salt Lake City: University of Utah.

La Porta, R., Lopez-de-Silanes, F., and Shleifer, A. 2000. Government ownership of banks. Working paper 762. Cambridge, Mass.: NBER.

La Porta, R., Lopez-de-Silanes, F., and Shleifer, A. 1999. Corporate ownership around the world. Journal of Finance 54, 471–517.

La Porta, R., Lopez-de-Silanes, F., Shleifer, A., and Vishny, R. W. 1997. Legal determinants of external finance. Journal of Finance 52, 1131–1150.

La Porta, R., Lopez-de-Silanes, F., Shleifer, A., and Vishny, R. W. 1998. Law and finance. Journal of Political Economy 106, 1113–1155.

La Porta, R., Lopez-de-Silanes, F., Shleifer, A., and Vishny, R. W. 2002. Investor protection and corporate valuation. Journal of Finance 57, 1147–1171.

Lenway, S., Morck, R., and Yeung, B. 1996. Rent seeking, protectionism, and innovation in the American steel industry. The Economic Journal 106, 410–421.

Lerner, J. 1995. Venture capitalists and the oversight of private firms. Journal of Finance 50, 301–318.

Lerner, J. 2000. Venture capital and private equity: A casebook. New York: Wiley.

Levinsohn, J., and Petropoulos, W. 2001. Creative destruction or just plain destruction?: The U.S. textile and apparel industry since 1972. Working paper 8348. Cambridge, Mass.: NBER.

Linsey, B., Griswold, D., and Lucas, A. 1999. The steel “crisis” and the costs of protectionism. Trade briefing paper no. 4, April 16. Washington, DC: Cato Institute. 6.

Loomis, C. 1998. A house built on sand. Fortune Magazine 138, no. 8, 110–116.

Loriaux, M. 1997. Socialist monetarism and financial liberalization in France. In Loriaux M. (Ed.), Capital ungoverned: Liberalizing finance in interventionist states Ithaca, N.Y.: Cornell University Press, 143.

Mahony, P. G. 2000. The political economy of the Securities Act of 1933. Working paper #00–11. Social Science Research Network (www.ssrn.com).

Maier, C. S. 1987. In search of stability: Explorations in historical political economy. Cambridge: Cambridge University Press.

Mandel, M. J. 2000. The coming Internet depression: Why the high-tech boom will go bust, why the crash will be worse than you think, and how to prosper afterward. New York: Basic Books.

McCarthy, F. T. 2000. The record industry takes fright. The Economist, 29 January, 69.

McCraw, T. 1997. American capitalism. In McCraw, T. (Ed.), Creating modern capitalism: How entrepreneurs, companies, and countries triumphed in three industrial revolutions. Cambridge: Harvard University Press, 320.

McCullough, D. 1977. The path between seas: The creation of the Panama Canal, 1870–1914. London: Simon and Schuster.

McNeill, W. H. 1982. The pursuit of power: Technology, armed force and society since AD 1000. Chicago: University of Chicago Press.

McPhee, P. 1989. The French revolution, peasants, and capitalism. American Historical Review 94, 1265–1280.

Meriwether, J. 1996. By the numbers. Institutional Investor, November, 62.

Micklethwait, J., and Wooldridge, A. 2000. A future perfect: The challenge and the hidden promise of globalization. New York: Crown Business.

Miller, M. 1977. Debt and taxes. Journal of Finance 32, no. 2, 261–275.

Mitchell, M. L., and Lehn, K. 1990. Do bad bidders become good targets? Journal of Political Economy 98, 372–398.

Mitchell, M., Pulvino, T., and Stafford, E. 2002. Limited arbitrage in equity markets. Journal of Finance 57, no. 2, 551–584.

Morck, R., Shleifer, A., and Vishny, R. 1990. The stock market and investment: Is the market a sideshow? Brookings Papers on Economic Activity 2, 157–202.

Morck, R., Strangeland, D., and Yeung, B. 2000. Inherited wealth, corporate control, and economic growth: The Canadian disease? In Morck, R. K. (Ed.), Concentrated Capital Ownership. Chicago: University of Chicago Press.

Morck, R., Yeung, B., and Yu, W. 2000. The information content of stock markets: Why do emerging markets have synchronous stock price movements? Journal of Financial Economics 58, 215–260.

Myers, S., and Rajan, R. 1998. The paradox of liquidity. Quarterly Journal of Economics 113, no. 3, 733–773.

Negley, G., and Patrick, J. 1952. The quest for utopia: An anthology of imaginary societies. New York: Henry Schuman.

Nickell, S. 1997. Unemployment and labor market rigidities: Europe versus North America. Journal of Economic Perspectives 11, 55–74.

North, D., and Weingast, B. 1989. Constitutions and commitment: The evolution of institutions governing public choice in seventeenth-century England. The Journal of Economic History 49, 803–832.

O’Brien, P. K. 1996. Path dependency, or why Britain became an industrialized and urbanized economy long before France. Economic History Review 49, 213–249.

Ofek, E., and Richardson, M. 2001. DotCom mania: a survey of market efficiency in the Internet sector. Unpublished working paper. New York: New York University.

Olson, K. 1974. The G.I. Bill, the veterans, and the colleges. Lexington, Ken. University of Kentucky Press.

Olson, M. 1971. The logic of collective action: Public goods and the theory of groups. Cambridge, Mass.: Harvard University Press.

O’Rourke, K. H., and Williamson, J. G. 1999. Globalization and history: The evolution of nineteenth-century Atlantic economy. Cambridge, Mass.: MIT Press.

Pagano, M., Panetta, F., and Zingales, L. 1998. Why do companies go public? An empirical analysis. Journal of Finance 53, 27–67.

Pagano, M., and Volpin, P., 2002. The political economy of finance. Discussion paper 3231. London: CEPR.

Parrino, R. 1997. CEO turnover and outside succession: A cross-sectional analysis. Journal of Financial Economics 46, 165–197.

Pascale, R., and Rohlen, T. P. 1983. The Mazda turnaround. Journal of Japanese Studies 9, 219–263.

Peltzman, S. 1976. Toward a more general theory of regulation. Journal of Law and Economics 19, 211–240.

Peltzman, S. 1989. The economic theory of regulation after a decade of deregulation. Brookings Papers on Economic Activity, Microeconomics 1989, 1–41.

Perez, S. A. 1997. From cheap credit to the EC: The politics of financial reform in Spain. In Loriaux, M. (Eds.), Capital ungoverned: Liberalizing finance in interventionist states. Ithaca, N.Y.: Cornell University Press.

Perez-Gonzalez, F. 2002. Does inherited control hurt performance? Unpublished working paper. New York: Columbia University.

Petersen, M., and Rajan, R. 1994. The benefits of lending relationships: Evidence from small business data. Journal of Finance 49, 3–37.

Petersen, M., and Rajan, R., 2002. Does distance still matter? The information revolution in small business lending. Journal of Finance, December, 57.

Peterson, G. P. 1999. Gray dawn: How the coming of age will transform America and the world. New York: Times Books.

Piketty, T., and Saez, E., 2001. Income inequality in the United States, 1913–1998. Working paper 8467. Cambridge, Mass.: NBER.

Pipes, R. 1999. Property and freedom. New York: Alfred A. Knopf.

Pirenne, H. 1937. Economic and social history of mediaeval Europe. New York: Harcourt, Brace and World, Inc.

Piven, F. F., and Cloward, R. 1971. Regulating the poor: The functions of public welfare. New York: Vintage.

Plautet, E. 1999. The role of banks in monitoring firms: The case of Crédit Mobilier. New York: Routledge.

Polanyi, K. 1944. The great transformation. Boston: Beacon Hill.

Posner, R. 1971. Taxation by regulation. Bell Journal of Economics 2, 22–50.

Poterba, J. 1990. The stock market and investment: Is the market a sideshow? Brookings Papers on Economic Activity 2, 208–213.

Poterba, J. 1999. The rate of return to corporate capital and factor shares: New estimates using revised national income accounts and capital stock data. Working paper 6263. Cambridge, Mass.: NBER.

Poterba, J., and Samwick, A. 1995. Stock ownership patterns, stock market fluctuations, and consumption. Brookings Papers on Economic Activity 2, 295–357.

Powell, E. 1915. The evolution of the money market (1385–1915): A historical and analytical study of the rise and development of finance as a centralized coordinated force. (London) The Financial News.

Powelson, J. P. 1988. The story of land: A world history of land tenure and agrarian reform. Cambridge: The Lincoln Institute of Land Policy.

Prendergast, C. 1999. The provision of incentives in firms. Journal of Economic Literature 37, 7–63.

Prowse, S. 1996. Alternative models of financial system development. Sydney: RBA Annual Conference Volume 1996–06, Federal Reserve Bank of Australia.

Pryor, F. 2000. Will most of us be working for giant enterprises by 2028? Journal of Economic Behavior and Organization 44, 363–382.

Rajan, R. G. 1992. Insiders and outsiders: The choice between informed and arm’s length debt. Journal of Finance 47, 1367–1400.

Rajan, R., and Servaes, H. 1997. Analyst following of initial public offerings. Journal of Finance 52, 507–529.

Rajan, R., and Wulf, J. 2002. The flattening firm: Evidence from panel data on the changing nature of corporate hierarchies. Unpublished working paper. Chicago: University of Chicago Graduate School of Business.

Rajan, R., and Zingales, L. 1998. Financial dependence and growth. American Economic Review 88, 559–586.

Rajan, R., and Zingales, L. 1998. Power in a theory of the firm. Quarterly Journal of Economics 112, 387–432.

Rajan, R., and Zingales, L. 1998. Which capitalism? Lessons from the East Asian crisis. Journal of Applied Corporate Finance 11, 40–48.

Rajan, R., and Zingales, L. 2000. The tyranny of inequality: An inquiry into the adverse consequences of power struggles. Journal of Public Economics 76, 521–558.

Rajan, R., and Zingales, L. 2001. The firm as a dedicated hierarchy: A theory of the origins and growth of firms. Quarterly Journal of Economics 116, 805–852.

Rajan, R., and Zingales, L. 2002. The great reversals: the politics of financial development in the 20th century. Journal of Financial Economics (forthcoming).

Ramseyer, M. 1994. Explicit reasons for implicit contracts: The legal logic to the Japanese main bank system. In Aoki, M., Patrick, H. (Eds.), The Japanese main bank system. New York: Oxford University Press, 231–257.

Ramseyer, J. M., and Rosenbluth, F. M. 1995. The politics of oligarchy. New York: Cambridge University Press.

Regis, N. F. 1919. A history of the bankruptcy law. Washington, DC: Potter & Co.

Roberts, D. 2001. Glorious hopes on a trillion-dollar scrapheap. Financial Times (London), 5 September, 12.

Rodrik, D. 1997. Has globalization gone too far? Unpublished working paper. Washington, DC: Institute for International Economics.

Rodrik, D. 1998. Democracies pay higher wages. Working paper 6364. Cambridge, Mass.: NBER.

Roe, M. J. 1994. Strong managers, weak owners: The political roots of American corporate finance. Princeton, N.J.: Princeton University Press.

Roosevelt, F. D. 1933. Public Papers and Addresses. New York: Russel & Russel.

Roosevelt, F. D. 1934. Public Papers and Addresses. New York: Russel & Russel.

Roosevelt, F. D. 1936. Public Papers and Addresses. New York: Russel & Russel.

Rose, N. L. 1998. Labor rent sharing and regulation: Evidence from the trucking industry 95, 1146–1178.

Rosenbluth, Frances. 1989. Financial politics in contemporary Japan. Ithaca, N.Y.: Cornell University Press.

Roshental, L., and Young, C. 1990. The seemingly anomalous price behavior of Royal Dutch Shell and Unilever nv/plc. Journal of Financial Economics 26, 123–141.

Rydqvist, K., and Hogholm, K. 1995. Going public in the 1980s: Evidence from Sweden. European Financial Management 1, 287–315.

Sah, R., and Stiglitz, J. 1986. The architecture of economic systems: Hierarchies and polyarchies. The American Economic Review 76 no. 4, 716–727.

Sapienza, P. 2002. What do state-owned firms maximize? Evidence from Italian banks. Unpublished working paper. Evanston, Ill.: Northwestern University.

Schill, M., and Zhou, C., 2001. Pricing an emerging industry: Evidence from Internet subsidary carve-outs. Financial Management, 30, no. 3, 5–35.

Schumpeter, J. A. 1993. The theory of economic development: An inquiry into profits, capital, credit, interest, and the business cycle. New Brunswick; London: Transaction Publishers.

Searjent, G. 1993. Why Daimler went red over a share quote in New York. The Times (London), 7 October.

Seligman, J. 1995. The transformation of Wall Street. Boston: Northeastern University Press.

Sen, A. 1999. Development as freedom. New York: Knopf.

Sharkey III, A. G. The Power of the New Steel Industry. American Iron and Steel Industry, http://www.steel.org/facts/power/newsteel.htm.

Shepherd, W. 1982. Causes of increased competition in the U.S. economy, 1939–1980. Review of Economics and Statistics 64, 613–626.

Shiller, R. 2001. Irrational exuberance. New York: Broadway Books.

Shirreff, D. 1998. The Eve of Destruction. EuroMoney 355, 34.

Shleifer, A., and Vishny, R. W. 1997. The limits to arbitrage. Journal of Finance 52, no. 1, 35–56.

Simon, C. J. 1989. The effect of the 1933 Securities Act on investor information and the performance of new issues. American Economic Review 79, 295–318.

Skidelsky, Robert. 2001. John Maynard Keynes: Fighting for freedom 1937–1946. New York: Viking.

Skocpol, T. 1997. The G.I. bill and U.S. social policy, past and future. In Paul, E., Miller, F., Paul, J. (Eds.), The welfare state. New York: Cambridge University Press.

Sokoloff, K. 2000. Institutions, factor endowments, and paths of development in the new world. Unpublished working paper. Los Angeles: UCLA.

Sokoloff, K., and Engerman, S. L. 2000. History Lessons. Institutions, factors endowment, and path of development in the new world. Journal of Economic Perspective 3, 217–232.

Sokoloff, K., and Engerman, S. L. 1994. Factor endowments, institutions, and differential paths of growth among new world economies: A view from economic historians of the United States. Historical working paper 66. Cambridge, Mass.: NBER.

Sorescu, S. 2000. The effect of options on stock prices: 1973 to 1995. Journal of Finance 55, 487–514.

Spender, P. 2000. Second-hand vehicle imports equal doom? The Economic Times (Mumbai), 18 January.

Stein, J. 2002. Information production and capital allocation: Decentralized vs. hierarchical firms. Journal of Finance 57.

Stevenson, H. 1996. Early career LBOs using the search fund model. Case Note 9–897–092. Boston: Harvard Business School.

Stigler, G. 1971. Theory of economic regulation. Bell Journal of Economics 2, 3–21.

Stiglitz, J. E. 2002. Globalization and its discontents. New York: W. W. Norton.

Stiglitz, J., and Weiss, A. 1981. Credit rationing in markets with imperfect information. American Economic Review 71, no. 3, 393–410.

Stole, L. A., and Zwiebel, J., 1996. Organizational design and technology choice under intra-firm bargaining. American Economic Review 86, 195–223.

Stone, L. 1965. Crisis of the aristocracy. Oxford: Clarendon Press.

Stromberg, D. 2001. Radio’s impact on public spending. Unpublished working paper. Stockholm: Stockholm School of Economics.

Summers, L. 1986. Does the stock market rationally reflect fundamental values? Journal of Finance 41, 591–600.

Svalaeryd, H., and Vlachos, J. 2002. Market for risk and openness and to trade: How are they related? Journal of International Economics 57, no. 2, 369–395.

Tanzi, V., and Schuknecht, L. 2000. Public spending in the 20th century: A global perspective. Cambridge: Cambridge University Press.

Tawney, R. H. 1941. The rise of the gentry, 1558–1640. The Economic History Review 11, no. 1, 1–38.

Temin, P. 1989. Lessons from the Great Depression. Cambridge, Mass.: MIT Press.

Teranishi, J. 1994. Loan syndication in wartime Japan. In Aoki, M., Patrick, H. (Eds.), The Japanese main bank system. New York: Oxford University Press, 57 table 2.2.

Thurow, L, 1980. The zero-sum society: Distribution and the possibilities for economic change. New York: Basic Books.

Toniolo, G. 1978. Crisi economica e smobilizzo pubblico delle banche miste (1930–1934). In Toniolo, G. (Ed.), Industria e Banca Nella Grande Crisi 1929–1934. Milan: Etas Libri.

Tuchman, B. 1979. A distant mirror: The calamitous 14th century. New York: Ballantine Books.

Tufano, P. 1996. How financial engineering can advance corporate strategy. Harvard Business Review 74, no. 1, 136–146.

U.S. Bureau of the Census. 1975. Historical Statistics of the United States, Colonial Times to 1970. Washington, DC: U.S. Bureau of the Census.

U.S. Bureau of the Census. 1996. Population of the United States by Age, Sex, Race, and Hispanic Origin: 1995 to 2050. Washington, DC: U.S. Bureau of the Census, Current Population Reports, Series P-25, No. 1130.

U.S. Bureau of the Census. 1999. Statistical Abstracts of the United States. Washington, DC: U.S. Bureau of the Census.

U.S. Census Bureau. 2001. Statistical Abstract of the United States. Washington, DC: US Census Bureau, table 1214.

Vittas, D., and Cho, Y. J. 1994. Credit policies: Lessons from East Asia. Washington, DC: The World Bank.

Von Greyerz, C. 1984. Accounting in Swiss company law. Der Schweizer Treuhander, 85–88.

Watters, T., Vastola, P., Beroud, O., Anankina, E., Yoshimura, M., Saimen, T., Qu, H., Takara, R., Parker, C., and Sprinzen, S., 2002. U.S. steel tariffs: who gains, who loses, and at what price? Standard and Poor’s. 14 March, www.standardandpoors.com/nordic/pdfs/ussteeltariffs.pdf

Warren, C. 1935. Bankruptcy in United States history. Cambridge, Mass.: Harvard University Press.

Weatherford, J., 1997. The history of money: From sandstone to cyberspace. New York: Crown Publishers.

Weisbach, M. S. 1988. Outside directors and CEO turnover. Journal of Financial Economics 20, 431–461.

Wermers, R. 1999. Mutual fund herding and the impact on stock prices. Journal of Finance 54, 584.

Wernerfelt, B. 1984. A resource-based view of the firm. Strategic Management Journal 5, 171–180.

Wilensky, H., and Turner, L. 1987. Democractic corporatism and policy linkages: The interdependence of industrial, labor-market, incomes, and social policies in eight countries. Working paper. Berkeley, Calif.: University of California Institute of International Studies.

Wolfe, T. 1987. The bonfire of the vanities. New York: Farrar, Straus and Giroux.

Wurgler, J. 2000. Financial markets and the allocation of capital. Journal of Financial Economics 58, 187–214.

Yergin, D., Stanislaw, J. 1999. The commanding heights: The battle between government and the marketplace that is remaking the modern world. New York: Touchstone.

Yunus, M. 1998. Banker to the poor: The autobiography of Muhammad Yunus, Founder of the Grameen Bank. London: Aurum Press.

Zachary, G. 1994. His way—How “barbarian” style of Philippe Kahn led Borland into jeopardy. The Wall Street Journal, 2 June, A1.

Zingales, L. 1998. The survival of the fittest or the fattest: Exit and financing in the trucking industry. Journal of Finance 53, 905–938.

Zysman, J. 1983. Governments, markets, and growth: Finance and the politics of industrial change. Ithaca, N. Y.: Cornell University Press.

———————

INDEX

*The following items may be used as a guide to search for information in this eBook.

access to finance; and benefits of market system; and bottom line on development; and collateral; and connections; and development of financial markets; and financial revolution; and future of capitalism; and impediments to development; and information; and infrastructure; and misappropriation; overview about; and relationship capitalism,; and reversal; and risk; and vertical integration; and when finance develops. See also banking; financiers

accounting; and financial development; and market suppression; and relationship capitalism; standards. See also disclosure; transparency

adverse selection

aging populations

antiglobalization

antimarket sentiment; and future of capitalism; and market suppression; and relationship capitalism

antitrust laws

arbitrage

authority

Bangladesh

banking; branch; and dark side of finance; deregulation of; and financial development; and financial revolution; and market suppression; nationalization of; and relationship capitalism; and reversal; and taming government; and when finance develops. See also financial institutions; specific bank

bankruptcy

Barings

Beatrice

Bell, Daniel

benchmark portfolios

billionaires

Brandeis, Louis

Brazil

Bretton Woods agreement

bubbles

“business judgment rule”

buyouts

Canada

capital flow; and market suppression; and relationship capitalism; and saving capitalism. See also openness

capitalism: as anachronistic term; crony; evils/flaws of; future of; saving; stability of. See also financial markets; market system; relationship capitalism

cartels

causality: and finance and growth

centralization

Chandler, Alfred

China

collateral

competition; and antiglobalization; and benefits of financial markets; and bottom line on development; and dangers to market system; and dark side of finance; and development of financial markets; and financial revolution; and future of capitalism; and impediments to development; internal; and market suppression,; and relationship capitalism; and reversal; and saving capitalism; in socialist economies; and vertical integration; and when finance develops

conflicts of interest

connection

constitutions

contracts; and access to finance; and financial development; and future of capitalism

coordination

corporate hierarchy

corporate raiders

corporations: and code of conduct; governance of; internal controls in; mobility of; new. See also corporate hierarchy; scandals, corporate

“creative destruction”; and market suppression; and relationship capitalism

Crédit Mobilier

critical resource theory

crony capitalism

Crusades

de Soto, Hernando

democracies; and financial development; and future of capitalism; and reversal; and taming government; taming incumbents in

depression. See Great Depression

deregulation. See regulation/deregulation

derivatives

disclosure; and financial development,; and relationship capitalism; and reversal; standards. See also accounting; transparency

distressed; and access to finance; and antiglobalization; and development of financial markets; and future of capitalism; and incumbents; and market suppression; and saving capitalism. See also poor; safety nets

diversification,

dividends

Dun and Bradstreet (D&B)

Dutt, James

economic forces versus ideas

efficiency; and dark side of finance; and future of capitalism; and impediments to development; and market suppression; and relationship capitalism; and saving capitalism

Ellis, Jim

enforcement; and bottom line on development; and impediments to development; and market suppression; and taming government

England; aristocracy in; banking in; gentry in; land in; parliament in; productivity in; property rights in; taming government in; and transformation of English monarchy; Tudor-Stuart. See also Great Britain; United Kingdom

Enron

entrepreneurs. See also new opportunities

equity markets. See stock markets

Euromarket

Europe; and market suppression; and relationship capitalism; and reversal; taming government in; and when finance develops. See also European Community; specific nation

European Union

exchange rates

farm subsidies

fear

Federal Reserve System

finance/financing: and benefits of financial markets; and bubbles; dark side of; in declining industries; and deviations from fundamental value; and effects of mispricing on investments; and growth; importance of; internal; overview about; problems intrinsic to; and second Industrial Revolution. See also access to finance; financial development; financial markets; financial revolution; relationship capitalism

financial development: and competition; and dark side of finance; and financial revolution; impediments to; as irreversible process; and need for central authority; and new opportunities; and openness; overview about; phases in historical; and political change; reaction to; reasons for; systematic evidence about; and technology; and when finance develops

financial institutions: and financial revolution; and market suppression; and relationship capitalism; and reversal; and saving capitalism; and when finance develops. See also banking

financial markets: abuses in; criticism and misunderstanding of; and dangers to market system; and democracy; examples of; and future of capitalism; importance of; liberalization of; opposition to; and politics of markets; and property rights; and reversal; risks in; size of; stability of; and taming government. See also access to finance; financial development; financial revolution

financial revolution: and access to finance; and aristocracy of capable and rich; and benefits of financial markets; and competition,; and cost of trading; and critical resource theory; and derivatives; and diversification and emergence of stock markets; and financial development; impact of; and mobility of workers; and new corporations; overview about; and relationship between owners and workers; and scale; and shrinking firms; and technology; and vertical integration

financiers: and benefits of financial markets; and collateral; collusion of; and connections; and financial development; functions of; and future of capitalism; as incumbents; and misappropriations; public’s image of,; and relationship capitalism; and reversal; and taming government; and vertical integration. See also venture capitalists

firms: insurance of people and not; and saving capitalism; shrinking of; standards for comparability across. See also vertical integration

fixed commissions

Forbes magazine

Fortune 500 companies

France; aristocracy in; banking in; Crédit Mobilier in; gentry in; industrial revolution in; industry in; limited liability in; and market suppression; in post-World War II years; property rights in; and relationship capitalism; taming government in; and when finance develops

“free cash flow problem”

free rides

gentry

Germany; banking in; development of financial markets in; and relationship capitalism; and reversal; and when finance develops

Glass-Steagall Act (U.S., 1933)

Global Crossing

globalization. See also antiglobalization movement

gold standard

governance: corporate; international

government; ability of incumbents to affect; and bottom line on development; corruption of; and Crusades; and dangers to market system; and development of financial markets; and future of capitalism; and impediments to development; and market suppression; and property rights; rapacious; and relationship capitalism; and reversal; and saving capitalism; in socialist economies; taming of; and when do financial markets emerge; and when finance develops. See also interventionism; specific nation

Great Britain. See also England; United Kingdom

Great Depression: and antiglobalization; and market suppression; political response to; and relationship capitalism; and reversal; and saving capitalism,; and when finance develops

Greenspan, Alan

growth; and financial development; and market suppression; and relationship capitalism; and saving capitalism

Harrington, James

Hayek, Friederich

Hobsbawm, Eric

human capital

ideas versus economic forces

incumbents; ability to affect government by; and dangers to market system; and democracy; and distressed; and financial development; and financial revolution; and future of capitalism; and market suppression; and reduction of incentives to oppose markets; and relationship capitalism; and reversal; rich as; and saving capitalism; and vertical

incumbents (cont’d)

integration; and when finance develops

India; and antiglobalization; collateral in; diamond trade in; and future of capitalism; property rights in

individual economic freedom: and access to finance; and benefits of financial markets; and competition; and cost of trading; and critical resource theory; and derivatives; and diversification and emergence of equity market; and financial development; and mobility of workers; and new corporation; overview of; and owners; and relationship between owners and workers; and scale; and shrinking firms; and technology; and vertical integration; and workers

individual mobility

industrial revolution

industry: and financial development; and reversal; and taming government; and when finance develops. See also type of industry or corporation

inflation

information; and access to finance; and financial development; and future of capitalism; reducing problems of; and relationship capitalism. See also disclosure

infrastructure; and access to finance; and benefits of financial markets; and financial development; and future of capitalism; and saving capitalism. See also institutions

inheritance

innovatio; and financial development; and financial revolution; and relationship capitalism

“insider-lending” practices

insider trading

institutional investors

institutions; and bottom line on financial development; and dangers to market system; and development of financial markets,; and reversal; and when finance develops. See also infrastructure

insurance. See also social insurance

integration: backward and forward. See also vertical integration

intellectual property

interest groups. See special interests

interest rates

international governance

International Monetary Fund

internet

interventionism; and financial development; and market suppression; and relationship capitalism; and reversal

investors; and bubbles; and dark side of finance; and financial development; power of; and relationship capitalism; and reversal; and taming government. See also institutional investors

Italy; banking in; financial development in; individual mobility in; lending policies in; and market suppression; private-public nexus in; and reversal; safety nets in; taming government in

Japan; aging population in; banking in; bonds in; bubbles in; demise of financial markets in; development of financial markets in; and market suppression; and relationship capitalism; and reversal; and when finance develops

“junk” bonds

Keynes, John Maynard

Knights Templar

knowledge

labor. See also workers

land. See also property/property rights

Latin America

Leeson, Nick

legacy costs

limited-liability corporations

Long Term Capital Management (LTCM)

managers/management; and dark side of finance; evaluation of; and financial revolution; and future of capitalism; and market suppression; misbehavior of; and relationship capitalism; salaries of; and vertical integration. See also corporate hierarchy; governance, corporate; owners/ownership

market system: dependence on political goodwill of; expansion of; functions of; future of; limitations of; overview about; rise of; rules for,; stability of; suppression of; survival of; as taken for granted; tensions between politics and. See also type of market or specific topic

Markowitz, Harry

Marx, Karl

Mazda Motors

mergers

Mexico

Microsoft

Middle Ages

misappropriations

mispricing on investments

Mitchell, Charles E.

mobility: corporate; individual; of workers. See also capital flow

modern business enterprise: emergence of

moral hazards

mutual funds

National City Bank

nationalization

new corporations

“New Deal”

new opportunities. See also entrepreneurs

New York Stock Exchange

Norway

openness; and financial development; and financial revolution; and future of capitalism; and market suppression; and relationship capitalism; and reversal; and saving capitalism. See also capital flow

options-pricing formula

Organization for Economic Cooperation and Development (OECD)

organizational pyramid

owners/ownership; of knowledge assets; relationship between workers and. See also land; property/property rights

Palm Computing

parliament

Pecora Committee (U.S. Senate)

Pereire, Emile and Isaac

Poland

politics/politicians; and antiglobalization; and dangers to market system; and development of financial markets; and future of capitalism; and impediments to development; and market suppression; and relationship capitalism; and reversal; and saving capitalism; in socialist economies; tensions between market system and; and when finance develops

Ponzi schemes

poor. See also distressed; safety nets; social insurance

portfolios

pressure groups. See special interests

prices. See also stock price

privacy rights

private equity market

private-public nexus

productivity

profits; and impediments to development; and reversal; and saving capitalism; and when finance develops

property/property rights,; and collateral; and financial development; and future of capitalism; intellectual; legal status of; origins of; in socialist economies; and taming government. See also specific nation

property taxes

protectionism. See also tariffs

prudent man rule

public: apathy of; awareness of; and dangers to market system; and development of financial markets; image of financiers of. See also public interest

public interest; and development of financial markets; and future of capitalism; and impediments to development; and relationship capitalism; and saving capitalism

Pujo Committee (U.S.)

puts, stock

rational discrimination

Reagan, Ronald

record companies

regulation/deregulation; and dangers to market system; and financial development; and financial revolution; and impediments to development; and relationship capitalism; and reversal; and saving capitalism; self-; and when finance develops

relationship capitalism; and Bretton Woods Agreement; and change; decline and fall of; differences between market-based and; and economic security; and ideas versus economic forces; and market suppression; and relationship finance; rise of; winners and losers in

reversal: and aftermath of World War I; consequences of; and demise of Japanese markets; and gold standard; and market suppression; overview about; and political response to depression; and private-public nexus in Italy; and reasons for suppression of market; and U.S. experience; between wars

Rhone-Poulenc

rich; and benefits of financial markets; and bottom line on development; and collateral; connections of; Forbes list of world’s; and inheritance; redistribution of wealth of; and saving capitalism; self-made; should we be concerned about

Rio Bolsa (Rio stock exchange)

risk; and access to finance; and bottom line on development; “catastrophic” ; and dark side of finance; and financial revolution,; and impediments to development; and market suppression; and misappropriations; reducing; and relationship capitalism; and when finance develops

Rockefeller, John D.

Roosevelt, Franklin D.

Rothschilds

Russia

S&P 500 index

safety nets

Saint-Simon, Henri de

scale

scandals, corporate

Schumpeter, Joseph

search funds

Securities and Exchange Commission (SEC)

Securities Dealers Association

self-employment

Shell Oil Company

smallness: trend toward,

Smith, Adam

Smoot-Hawley bill

social insurance

socialism; and access to finance; and future of capitalism; and reversal,; and when finance develops

South America

South Korea

Spain

special interests: containment of; and dangers to market system; and future of capitalism; and impediments to development; and market suppression; and relationship capitalism; and reversal; and saving capitalism; and when finance develops

squirearchy. See gentry

staging of funds

Standard Oil

standards: for comparability across firms. See also accounting: standards; disclosure: standards; gold standard

steel industry

Stigler, George

stock markets: and access to finance; booms and busts in; capitalization of; diversification and emergence of; and financial revolution; and impediments to development; and information problems; introduction of new; and market suppression; and relationship capitalism; and reversal; size of; and when finance develops. See also bubbles

stock price

stool maker of Jobra village

strategic complements

Sweden

Switzerland

syndicates

takeovers, corporate

tariffs

taxes; and relationship capitalism; and saving capitalism; and taming government; and when finance develops. See also type of tax

taxi medallions

technology; and antiglobalization; and financial revolution; and future of capitalism; and individual economic freedom; and relationship capitalism; and saving capitalism; and vertical integration; and when finance develops

textile industry

Thatcher, Margaret

3Com

Toyota

trading: cost of

trading zones

transparency; and impediments to development; and relationship capitalism; and reversal; and when finance develops. See also disclosure

trucking industry

trusts, corporate. See also antitrust laws

Tyco

uncertainty

United Kingdom. See also England; Great Britain

United States. See specific topic

value: and access to finance; and dark side of finance; and financial revolution; fundamental; and impediments to development; and misappropriations; and saving capitalism; and taming government

venture capitalists (VCs)

vertical integration: breakup of; emergence of; and financial revolution

viaticals

“vulture” funds

wages; and financial revolution; and relationship capitalism; and reversal; and vertical integration

war

waste

Wilson, Woodrow

Wolfe, Tom

workers; and individual economic freedom; mobility of; relationship between owners and; and reversal; rights of; in socialist economies; and vertical integration; wages of. See also labor

World War I

World War II

Yunus, Muhammad

Zapata Corporation

ABOUT THE AUTHORS

RAGHURAM G. RAJAN, the Joseph Gidwitz Professor of Finance at the University of Chicago’s Graduate School of Business (GSB), was born in India in 1963. He joined the GSB in 1991 after earning his Ph.D., and just three years later the GSB voted to promote him to a tenured full professor. He teaches the highly rated case course in corporate financial management at the GSB. Rajan is one of the foremost academic experts on banking and on comparative financial systems. His papers have been published in the leading economics and finance journals. He also writes for The Business Standard (India). He is a director of the American Finance Association, an associate editor of the American Economic Review, and program director for corporate finance at the National Bureau of Economic Research.

LUIGI ZINGALES, the Robert C. McCormack Professor of Entrepreneurship and Finance at the University of Chicago’s Graduate School of Business, was born in Italy in 1963. Zingales teaches a popular course at the GSB on financing new ventures. He is one of the foremost academic experts on corporate governance and is an inaugural fellow of the recently instituted European Corporate Governance Panel. His papers have been published in the top finance and economics journals. He also has been a regular columinist for Il Corriere della Sera, the leading Italian newspaper. He is a faculty research associate at the National Bureau of Economic Research and a research fellow at the Center for Economic Policy Research.

Copyright © 2003 by Raghuram G. Rajan and Luigi Zingales

All rights reserved. No part of this book may be reproduced

in writing from the publisher.

Published by Crown Business, New York, New York.

Member of the Crown Publishing Group,

a division of Random House, Inc.

www.randomhouse.com

CROWN BUSINESS is a trademark and the Rising Sun

colophon is a registered trademark of Random House, Inc.

Library of Congress Cataloging-in-Publication Data

Rajan, Raghuram.

Saving capitalism from the capitalists : unleashing the power of financial markets to create wealth and spread opportunity

/ Raghuram G. Rajan.—1st ed.

1. Capital market. 2. Financial development.

4. Political economy of development. I. Title.

HG4523 .R345 2003

332'.041—dc21 2002012217

eISBN 1-4000-4916-4

v1.0