Abstract: The public firm, with dispersed stockholders in deep liquid securities markets, dominates business in the United States. Despite its pervasiveness, it has well-known infirmities, namely in the fragile ties that bind managers to shareholders. If shareholders strongly fear managers' disloyalty or incompetence, they will invest warily; if sufficiently fearful, they will not invest at all, and other ownership structures will prevail. But the core problems of binding managers to shareholders in the United States have shrunk to acceptable levels; investors are not so afraid of managers that they refuse to invest. Indeed, these problems have been handled so well that we fail to recognize the political prerequisites to resolving them and tying American managers to dispersed stockholders.
Publication Year: 2004
Publication Date: 2004-04-08
Language: en
Type: book-chapter
Indexed In: ['crossref']
Access and Citation
Cited By Count: 7
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