We also show that, in developed economies, providing public shareholders
with stronger legal protection against corporate insiders is associated greater
"rm-speci"c returns variation, and so with lower synchronicity. We conjecture
that economies that protect public investors' property rights might discourage
intercorporate income-shifting by controlling shareholders. Better property
rights protection thus might render "rm-speci"c risk-arbitrage more attractive
in the stock markets of such economies.