Contributor(s): Dr Carsten Gerner-Beuerle, Dr Tom Kirchmaier | By most standards, Britain in the mid-19th century was not only the preeminent industrial power in the world, but also possessed more developed capital markets than any other country. The probably most widely accepted explanation attributes this gap in financial development to more stringent disclosure requirements and more effective enforcement mechanisms in Britain. The explanatory models, however, are commonly not based on a detailed comparative legal analysis of the regulatory environment, but consider only isolated major reforms. The discussed research constructs a comprehensive time series of the evolving disclosure framework and private enforcement mechanisms during the formative stage of capital markets in Britain and one large emerging economy of continental Europe, Germany.