This paper by Alexander Dyck and Luigi Zingales examines the private benefits of control in 39 countries, based on 412 control transactions between 1990 and 2000. The authors find that the value of control ranges from -4% to +65%, with an average of 14%. They predict that in countries with larger private benefits of control, capital markets are less developed, ownership is more concentrated, and privatizations are less likely to occur as public offerings. The study also analyzes the institutions that curb these private benefits, finding that statutory protection of minority shareholders and law enforcement are associated with lower levels of private benefits. Additionally, a high level of press diffusion, tax compliance, and product market competition also contribute to lower private benefits. The authors suggest that extra-legal mechanisms, such as the press and tax enforcement, may be as important as legal ones in curbing private benefits. The findings support the idea that private benefits of control can significantly impact the development of financial markets.This paper by Alexander Dyck and Luigi Zingales examines the private benefits of control in 39 countries, based on 412 control transactions between 1990 and 2000. The authors find that the value of control ranges from -4% to +65%, with an average of 14%. They predict that in countries with larger private benefits of control, capital markets are less developed, ownership is more concentrated, and privatizations are less likely to occur as public offerings. The study also analyzes the institutions that curb these private benefits, finding that statutory protection of minority shareholders and law enforcement are associated with lower levels of private benefits. Additionally, a high level of press diffusion, tax compliance, and product market competition also contribute to lower private benefits. The authors suggest that extra-legal mechanisms, such as the press and tax enforcement, may be as important as legal ones in curbing private benefits. The findings support the idea that private benefits of control can significantly impact the development of financial markets.