Villalonga, BelénAmit, Raphael2023-05-222023-05-222009-08-012018-07-09https://repository.upenn.edu/handle/20.500.14332/40467In large U.S. corporations, founding families are the only blockholders whose control rights on average exceed their cash-flow rights. We analyze how they achieve this wedge, and at what cost. Indirect ownership through trusts, foundations, limited partnerships, and other corporations is prevalent but rarely creates a wedge (a pyramid). The primary sources of the wedge are dual-class stock, disproportionate board representation, and voting agreements. Each control-enhancing mechanism has a different impact on value. Our findings suggest that the potential agency conflict between large shareholders and public shareholders in the United States is as relevant as elsewhere in the world.This article has been accepted for publication in The Review of Financial Studies Published by Oxford University Press. The final version is available at http://dx.doi.org/10.1093/rfs/hhn080Business Administration, Management, and OperationsBusiness and Corporate CommunicationsBusiness IntelligenceBusiness Law, Public Responsibility, and EthicsManagement Information SystemsManagement Sciences and Quantitative MethodsOrganizational Behavior and TheoryStrategic Management PolicyReport