© 1999

The Development of Equity Capital Markets in Transition Economies

Privatisation and Shareholder Rights


Part of the Contributions to Economics book series (CE)

Table of contents

  1. Front Matter
    Pages I-X
  2. Dirk Willer
    Pages 1-18
  3. Back Matter
    Pages 119-129

About this book


This book addresses two different but related topics that can arise during the development of equity capital markets and which could possibly hinder their development: partial privatisation and shareholder rights. Both issues are developed in the context of transition economies in general and Russia in particular. Chapter 2 puts forward a theory of partial privatisation, i. e. a model that aims to explain why the state keeps some residual shares. Several recent surveys for Russia have shown that the state does often not actively use the voting rights of its residual shares. If this was true, partial privati­ sation could entrench management and hinder restructuring. It would also limit the supply of shares, which could lead to low liquidity. This would be likely to slow down the development of the equity capital market. However, the model in chapter 2 shows that it can be rational to hold back shares from sale in order to maximise privatisation receipts. Another issue which holds back the development of this market is the fact that shareholder rights can­ not be guaranteed by the state due to weak institutions. Chapter 3 contains an empirical examination of which firms honour shareholder rights and also provides a direct link between this problem and partial privatisation. Maybe surprisingly, some weak evidence is presented that shows that the residual state holding does not exert a negative influence with respect to the introduc­ tion of shareholder rights, but might even be a weak positive force.


Aktienmärkte Developing Countries Equity Capital Markets Privatisation Privatisierung Rating Russia Russland

Authors and affiliations

  1. 1.Centre of Economic PerformanceLondon School for EconomicsLondonUK

Bibliographic information

  • Book Title The Development of Equity Capital Markets in Transition Economies
  • Book Subtitle Privatisation and Shareholder Rights
  • Authors Dirk Willer
  • Series Title Contributions to Economics
  • DOI
  • Copyright Information Physica-Verlag Heidelberg 1999
  • Publisher Name Physica-Verlag HD
  • eBook Packages Springer Book Archive
  • Softcover ISBN 978-3-7908-1198-8
  • eBook ISBN 978-3-642-99809-6
  • Series ISSN 1431-1933
  • Edition Number 1
  • Number of Pages X, 128
  • Number of Illustrations 0 b/w illustrations, 0 illustrations in colour
  • Topics Development Economics
    Finance, general
    Economic Policy
  • Buy this book on publisher's site
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