The problem of managerial agency costs dominates debates in corporate law. Many leading scholars advocate reforms that would reduce agency costs by forcing firms to allocate more control to shareholders. Such proposals disregard the costs that shareholders avoid by delegating control to managers...

Rationales for a stakeholder model of corporate governance are based on enlightened self-interest, moral imperative, and/or externalities. Of these, the externalities rationale holds the most promise to justify a stakeholder focus. Recent evidence, however, indicates that the benefits of a...

Convergence and Persistence in Corporate Governance does not add groundbreaking new insights to the relevant debate or deliberate extensively on the most recent developments. Bringing together most of the trend-setting articles in a slightly revised form in a concise volume, however, serves an...

Recent years have witnessed an enormous amount of reorganization of the corporate sector in the US and in Europe. This paper examines the role of market competition for this trend in corporate reorganization. We find that at intermediate levels of competition the CEO of the corporation decides...

This paper builds on Riordan and Williamson (1985) by exploring the economizing choice of organizational form by firms competing in a homogeneous-good market. The paper investigates rivalrous firms' investment and organization choice in a Cournot competition. The model suggests that both...

This paper builds on Riordan and Williamson (1985) by exploring the economizing choice of organizational form by firms competing in a homogeneous-good market. The paper investigates rivalrous firms' investment and organization choice in a Cournot competition. The model suggests that both...

A fundamental question for economics is why large firms in market economies usually assign control rights to capital suppliers rather than labor suppliers. A diverse collection of answers can be found in the literature. But unfortunately little theoretical consensus has emerged, and few attempts...

Research on the nature and value of firms’ dynamic capabilities has produced contradictory propositions and findings. Scholars have argued that contingency theorizing has the potential to improve our understanding, as the context in which dynamic capabilities are deployed may affect their...

The rapid growth in index funds and significant consolidation in the asset-management industry over the past few decades has led to higher levels of common ownership and increased attention on the topic by academic researchers. A consensus has yet to emerge from the literature regarding the...

We analyze the optimal ownership, delegation and compensation structures when a manager is hired to run a firm and to gather information on investment projects. The initial owner has two tasks: monitoring the manager and supervising project choice. Optimality would require a large ownership...