| Business History
Does the Law and Finance Hypothesis Pass the Test of History?
For the body of work known as the law and finance literature, the development of
financial markets and the concentration of ownership across countries is to a large
extent the consequence of the legal system nations created or inherited decades or
hundreds of years ago. Despite the seemingly historical nature of this explanation, most
of the body of work supporting the law and finance hypothesis has been ahistorical. This paper summarises the business history literature and provides evidence on investor
protection and financial development over the long run that challenges the main tenets
of the law and finance literature.
Business and Shareholder Relations;
Financial Services Industry;