Cambridge University Press, 2009

In this book I challenge the law and finance literature and the idea that legal institutions are what determines the financial development of a country. I show how the founders of firms can create company bylaws with corporate governance arrangements that protect shareholders against the abuses of managers or the founders themselves, even when the law does not include such protections explicitly.  That is, the protections for investors included in the bylaws of early Brazilian corporations explain, to a large extent, Brazil’s success in financing its first wave of industrialization (1882-1950). In particular, early Brazilian corporations included investor protections such as maximum vote provisions, which capped the number of votes a single shareholder could exercise during a shareholder meeting.  That is, the founders of a firm would impose restrictions on their power in order to attract investors to finance the expansion of their business. I argue that corporate insiders provided such protections in Brazil to match the kind of protections British corporations afforded to investors at the time. Furthermore, my statistical analysis of the shareholder lists of nearly 100 Brazilian companies revealed a significant correlation between having such corporate statutes protecting small shareholders and having less concentrated ownership and control. 

( Harvard University Press, April 2014 )

with  Sergio G. Lazzarini 

Read the introduction of the book here ; Review in the Schumpeter column (The Economist), June 2014 ;  Also, our working paper Leviathan in Business (summary of the intro and first chapters of the book) was featured on The Visible Hand Special Report , The Economist, January 2012.

Online debate on State Capitalism: Aldo Musacchio vs Ian Bremmer 

Here is the summary of the book according to ChatGPT

"Reinventing State Capitalism" explores the evolution of state capitalism in the 21st century. The book focuses on the experiences of state-owned enterprises (SOEs) in emerging markets, specifically in China, Brazil, and Russia. Musacchio and Lazzarini argue that state capitalism has undergone a transformation in recent years, moving away from the traditional model of state control over industry and towards a more market-oriented approach.

The book uses case studies of SOEs in the energy, telecommunications, and transportation sectors to illustrate his points. He notes that these enterprises have become more competitive, efficient, and profitable under the new model of state capitalism. However, he also acknowledges that there are challenges to this approach, including the risk of corruption, the potential for political interference, and the need for regulatory frameworks that balance state ownership with market principles.

Throughout the book, the authors provide a nuanced analysis of state capitalism, drawing on a wide range of academic research and empirical evidence. He argues that state capitalism is not a monolithic concept, but rather a diverse set of practices that vary depending on the political and economic context. Musacchio and Lazzarini's  book is an important contribution to the study of state capitalism, offering insights into how this economic model is evolving and what the implications are for emerging markets and the global economy.