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Trust and Opportunism in Close Corporations

Mahoney, Paul G. - 1998

The majority shareholder in a closely held corporation may use its control of the corporate machinery to appropriate wealth from the minority, and it is difficult for the majority to make a binding commitment not to do so. This paper models the interaction between majority and minority...

Persistent link: https://www.econbiz.de/10012471994

Confidence Management in Tournaments

Deng, Shanglyu - 2020

An incumbent employee competes against a new hire for bonus or promotion. The incumbent's ability is commonly known, while that of the new hire is private information. The incumbent is subject to a perceptional bias: His prior about the new hire's type differs from the true underlying...

Persistent link: https://www.econbiz.de/10012481769

Finance and the Preservation of Wealth

Gennaioli, Nicola - 2013

We introduce the model of asset management developed in Gennaioli, Shleifer, and Vishny (2012) into a Solow-style neoclassical growth model with diminishing returns to capital. Savers rely on trusted intermediaries to manage their wealth (claims on capital stock), who can charge fees above costs...

Persistent link: https://www.econbiz.de/10012459544

Money Doctors

Gennaioli, Nicola - 2012

investment, and allows managers to charge higher fees to investors who trust them more. Money managers compete for investor funds … by setting their fees, but because of trust the fees do not fall to costs. In the model, 1) managers consistently … involve sharing of expected returns between managers and investors, with higher fees in riskier products, 3) managers pander …

Persistent link: https://www.econbiz.de/10012460486