IDEAS home Printed from https://ideas.repec.org/a/bla/ehsrev/v59y2006i2p320-346.html
   My bibliography  Save this article

The impact of limited liability on ownership and control: Irish banking, 1877–19141

Author

Listed:
  • GRAEME G. ACHESON
  • JOHN D. TURNER

Abstract

Limited liability is regarded as the sine qua non of the modern company, enabling firms to raise capital from a broad spectrum of investors who have well‐diversified portfolios. This article uses the ownership records of an Irish bank, which converted to limited liability in 1883, to explore the impact of introducing limited liability upon ownership and control. We find that ownership becomes more dispersed amongst individuals from a broader social and geographical spectrum. However, there appears to be little impact on portfolio diversification. Furthermore, although limited liability appears to contribute to the rise of the professional director, the evidence suggests that managerial incentives may have been weakened.

Suggested Citation

  • Graeme G. Acheson & John D. Turner, 2006. "The impact of limited liability on ownership and control: Irish banking, 1877–19141," Economic History Review, Economic History Society, vol. 59(2), pages 320-346, May.
    • Handle: RePEc:bla:ehsrev:v:59:y:2006:i:2:p:320-346
    DOI: 10.1111/j.1468-0289.2006.00348.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1468-0289.2006.00348.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1468-0289.2006.00348.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Howard Bodenhorn, 2011. "Partnership fragility and credit costs," NBER Working Papers 16689, National Bureau of Economic Research, Inc.
    2. Ilgmann, Cordelius, 2011. "The advent of corporate limited liability in Prussia 1843," CAWM Discussion Papers 46, University of Münster, Münster Center for Economic Policy (MEP).
    3. Jenter, Dirk & Aldunate, Felipe & Korteweg, Arthur & Koudijs, Peter, 2021. "Shareholder Liability and Bank Failure," CEPR Discussion Papers 16309, C.E.P.R. Discussion Papers.
    4. Paolo Maggioni, 2011. "The introduction of limited liability in nineteenth century England," Openloc Working Papers 1116, Public policies and local development.
    5. Richard S. Grossman & Masami Imai, 2011. "Contingent Capital and Bank Risk-Taking among British Banks before World War I," Wesleyan Economics Working Papers 2011-003, Wesleyan University, Department of Economics.
    6. Grodecka, Anna & Kotidis, Antonis, 2016. "Double Liability in a Branch Banking System: Historical Evidence from Canada," Working Paper Series 316, Sveriges Riksbank (Central Bank of Sweden).
    7. Howard Bodenhorn, 2015. "Double Liability at Early American Banks," NBER Working Papers 21494, National Bureau of Economic Research, Inc.
    8. Acheson Graeme G. & Hickson Charles R & Turner John D, 2010. "Does Limited Liability Matter? Evidence From Nineteenth-Century British Banking," Review of Law & Economics, De Gruyter, vol. 6(2), pages 247-273, December.
    9. Janette Rutterford & David R. Green & Josephine Maltby & Alastair Owens, 2011. "Who comprised the nation of shareholders? Gender and investment in Great Britain, c. 1870–1935," Economic History Review, Economic History Society, vol. 64(1), pages 157-187, February.
    10. Bargeron, Leonce & Lehn, Kenneth, 2017. "Limited liability and share transferability: An analysis of California firms, 1920–1940," Journal of Corporate Finance, Elsevier, vol. 44(C), pages 451-468.
    11. Salter, Alexander W. & Veetil, Vipin & White, Lawrence H., 2017. "Extended shareholder liability as a means to constrain moral hazard in insured banks," The Quarterly Review of Economics and Finance, Elsevier, vol. 63(C), pages 153-160.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ehsrev:v:59:y:2006:i:2:p:320-346. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/ehsukea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.