This paper analyses the regulatory attitudes to asset valuation in the twentieth century. It focuses in particular on the US experience from <italic>Smith v Ames 169 US 466 (1898)</italic> to <italic>Federal Power Commission v Hope Natural Gas 320 US 591 (</italic><italic>1944</italic>) and on the experience in the UK in last two decades of the...

The paper considers a model of the firm in which management acts to maximize share-holder welfare (i. e. owner controlled) and bargains over wages and employment with existing workers. The main result of the paper is that the performance of owner controlled firms will be independent of the...