In this paper, I develop a model of oligopoly with shareholder voting. Instead of assuming that firms maximize profits, the objective of the firms is decided by majority voting. This implies that portfolio diversification generates tacit collusion. In the limit, when all shareholders are...

It is surprising that a so important concept for valuation, and a building block of theoretical and applied corporate finance, as the competitive advantage period (CAP), first developed by Modigliani and Miller in 1961 in their seminal paper on Dividend Policy, Growth, and the Valuation of...