This paper focuses on the relations between corporate ownership structure and the quality of accounting information in seven East Asian economies excluding Japan. More specifically, we use the informativeness of accounting earnings to investors as a measure of the quality of accounting information. We develop two complementary arguments pertaining to the relations between ownership structure and earnings informativeness. The first argument is related to the entrenchment effect of ownership concentration (Morck, Shleifer, and Vishny, 1988). Corporate ownership is highly concentrated in East Asia. As the controlling owners are entrenched by their effective control of the firms, their decisions that deprive the rights of minority shareholders are often uncontestable.
