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Corporate Governance

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Abstract

Introduced in the mid-1980s, the term ‘corporate governance’ can be defined as the set of conditions that shapes the ex post bargaining over the quasi-rents generated by a firm. The incomplete contracts approach has been very successful in explaining the corporate governance of entrepreneurial firms and also some important features of large corporations, such as allocation of ownership to the providers of capital who are dispersed, and the importance of internal organization. Aspects that remain to be investigated include the role of the board of directors, interaction between different mechanisms of corporate governance, and the normative implications of the approach.

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Zingales, L. (2018). Corporate Governance. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_2416

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