When did Ownership Separate from Control? Corporate Governance in the Early Nineteenth Century

Eric Hilt

NBER Working Paper No. 13093
Issued in May 2007
NBER Program(s):   CF   DAE   LE

This paper analyzes the ownership and governance of the business corporations of New York State in the 1820s. Using a new dataset collected from the manuscript records of New York's 1823 capital tax, and from the charters of the corporations, I analyze the ownership structures of the firms, and investigate the degree to which ownership was separated from control at the time. In contrast to Berle and Means's account of the development of the corporation, the results indicate that many of the firms were dominated by large shareholders, who were represented on the firms' boards, and held sweeping power to utilize the firms' resources for their own benefit. The oppression of minority shareholders was a significant problem in early corporate governance, and many of the firms configured their voting rights in a way that curtailed the power of large investors. A positive relationship between firm value and these voting rights configurations is found among the publicly-traded firms in the sample.

download in pdf format
   (294 K)

email paper

This paper is available as PDF (294 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w13093

Published: Hilt, Eric, 2008. "When did Ownership Separate from Control? Corporate Governance in the Early Nineteenth Century," The Journal of Economic History, Cambridge University Press, vol. 68(03), pages 645-685, September. citation courtesy of

Users who downloaded this paper also downloaded these:
Morck and Steier w11062 The Global History of Corporate Governance: An Introduction
Hilt w14892 Wall Street's First Corporate Governance Crisis: The Panic of 1826
Bolton, Becht, and Röell w9371 Corporate Governance and Control
Calomiris The Costs of Rejecting Universal Banking: American Finance in the German Mirror, 1870-1914
Hermalin and Weisbach w12050 A Framework for Assessing Corporate Governance Reform
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us