The value of the share depends on how well its property rights are enforced. The enforcement of property rights is usually undertaken by both individual owners and the state. In economies where the state does not effectively enforce property rights, the enforcement by individual owners plays a relatively more important role. The structure of share ownership affects the degree to which corporate contracts are enforced, because it affects the owners’ abilities and incentives to enforce the property rights delineated by the contracts. One prediction from the property rights framework is that concentrated ownership will be observed in economies where property rights are not well enforced by the state
