Theoretical and Empirical Research on the Legal Protection of Investors

Author: Luan Tianhong
Publisher:
Publish Date: 2006-05-01
Features: This book focuses on the legal protection of investors as its research subject, introducing legal issues into economic analysis. It aims to explore theoretical mechanisms and pathways to enhance legal protection for investors and to validate corresponding theoretical propositions using data from various countries. For this purpose, the book is divided into four parts and eight chapters. The first part presents the main research questions; the second and third parts focus on theoretical analysis, discussing specific mechanisms and pathways to enhance investor protection from the perspectives of endogenous determination of investor legal protection and external substitute mechanisms. The fourth part uses data from China and transition economies to empirically test the relevant theoretical propositions. This book primarily examines issues related to investor legal protection, mainly exploring specific pathways to enhance investor protection through the determination and substitution of investor legal protection. The book investigates the substitution effect of insider equity ownership on investor legal protection and the effectiveness of external large shareholder supervision. Regarding the substitution of creditor protection, the book proposes that dual financial systems (formal finance and informal finance) correspond to different contract enforcement mechanisms (formal judicial mechanisms and informal personalized enforcement mechanisms). In situations where judicial mechanisms are imperfect, informal enforcement mechanisms associated with informal finance often serve as a significant substitute for the formal enforcement mechanisms relied on by formal finance.