Friday, November 21, 2014

The Short-Termism Debate - Event Video

Federalist Society 2014 National Lawyers Convention video beaturing Lucian Bebchuk, Jonathan R. Macey, Robert T. Miller, Steven A. Rosenblum, and E. Norman Veasey
"For thirty years, the economic analysis of corporate law has been based on the assumption that shareholder value is a reliable proxy for social welfare. However, for some time now, the large majority of the shares in some public companies have been held by institutional investors, including pension funds and mutual funds. These investors have some incentive to favor short-term profits at the expense longer-term benefits. Can shareholder value still be reliably equated with social welfare? Or does the current incentive structure encourage the misallocation of resources and a net social loss?"