We reason that agency theory’s behavioral assumptions may too closely reflect the US institutional context to explain the governance heritages that exist elsewhere. We propose that what constitutes opportunistic behavior and what can be done to limit it may vary due to differences in national background and formal institutions. We then test the validity of this nationally bounded model using historical sociology analysis of three nations whose corporate governance heritages are believed to differ (USA, Sweden, and France). Specifically, we review their political, cultural, and economic institutions to explore the different ways that their governance practices have evolved and infer causes for these historical variations.
