Ownership and Control of German Corporations

In a study of the ownership of German corporations, we finda strong relation between board turnover and corporate performance,little association of concentrations of ownership with managerialdisciplining, and only limited evidence that pyramid structurescan be used for control purposes. The static relationship ofownership to control in Germany is therefore similar to theUnited Kingdom and the United States. However, there are markeddifferences in dynamic relations involving transfers of ownership.There is an active market in share blocks giving rise to changesin control, but the gains are limited and accrue solely to theholders of large blocks, not to minority investors. We provideevidence of low overall benefits to control changes and theexploitation of private benefits of control.     

Taxation and Integrated Financial Markets: The Challenges of Derivatives and Other Financial Innovations

The past decade has witnessed the explosive growth of a multiplicity of new instruments which have altered the financial landscape. These transactions have highlighted many of the inconsistencies, asymmetries and shortcomings of current tax practices and challenged some basic tax principles. The ensuing uncertainties could over the long term place considerable strain on the tax system by increasing the opportunities for abuse and raising overall compliance costs. At the same time derivatives have provided a better understanding of the operation tax laws and from this standpoint have provided a positive input into policy design. This paper has three objectives: (a) to illustrate some of the weaknesses of the current tax system by focusing on several types of novel transaction; (b) to assess the validity of various types of adjustment proposed to tax code; (c) to draw out the implications of these developments for the ongoing debate over fundamental tax reforms and over source versus residence based taxes.     

The Labour Government and the National Health Service

This paper reviews the performance of the National Health Serviceunder the Labour government of Tony Blair. It shows that therehave been some dramatic increases in resources going into theservice, but also that these do not seem to be delivering theimprovements in activities that might have been expected. Thepaper argues that this is partly because of capacity constraints,but also because the mixture of organizational forms introducedby the government has resulted in misdirected and conflictingincentive structures for the key actors.     

Ownership and trust

In unique research, Julian Franks looked at over 100 years of data on corporate ownership and found that relationships of trust have been a crucial historical ingredient in the ownership of firms. He argues that relationships of trust are as important now as ever.