When do Stakes in Restructuring put Restructuring at Stake?

Philipp J. H. Schröder

Chapter Chapter 2 in The Socio-Economic Transformation, 2007, pp 17-30 from Palgrave Macmillan

Abstract: Abstract Frequently the shareholders of privatized transition firms also hold stakes in the firm they own. This two-sided role of an agent may give rise to potential conflicts when the restructuring strategy of a firm has to be decided. This shareholder/stakeholder conflict is analyzed in a simple framework including the corporate control dimension of the problem. It is found that for feasible specifications of the conflict, restructuring in the economy will fall short of complete efficiency. However, for certain parameter values the shareholder/stakeholder issue turns out to be a non-problem.

Keywords: Transition Economy; Corporate Control; European Economic Review; Stakeholder Interest; Soft Budget Constraint (search for similar items in EconPapers)
Date: 2007
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-37903-9_2

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DOI: 10.1057/9780230379039_2

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