Connecting the Dots

Bernard E. Munk

Chapter Chapter 8 in Disorganized Crimes, 2013, pp 100-117 from Palgrave Macmillan

Abstract: Abstract At the end of the Great Inflation (the end of the 1970s), there was a burst of activity in the market for corporate control. These efforts centered on breaking up the conglomerates and energizing complacent managements. In the view of many business analysts, there had been gross underinvestment in existing public companies and the actual capital invested was not creating adequate rates of return to shareholders. Economic theorists recognized this as part of the agency problem that inevitably arose from the division of decision-making and ownership in the modern corporation. The cure was said to be making managers behave more like equity owners. The device to accomplish this goal was that a significant portion of total managerial compensation should be paid in common stock.

Keywords: Corporate Governance; Balance Sheet; Earning Management; Audit Committee; Stock Option (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-33027-7_8

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DOI: 10.1057/9781137330277_8

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