The Distribution of Power Among Corporate Managers, Shareholders, and Directors
Michael C. Jensen
Harvard Business School; Social Science Electronic Publishing (SSEP), Inc.; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI)
Jerold B. Warner
Simon Graduate School of Business, University of Rochester
June 1, 1988
Journal of Financial Economics (JFE), Vol. 20, pp. 3-24, 1988
Michael C. Jensen, A THEORY OF THE FIRM: GOVERNANCE, RESIDUAL CLAIMES AND ORGANIZATIONAL FORMS, Harvard University Press, December 2000
Harvard NOM Working Paper No. 00-09
This article surveys the seventeen papers in this special issue of the Journal of Financial Economics, and related work. The major findings are: (1) patterns of stock ownership by insiders and outsiders can influence managerial behavior, corporate performance, and stockholder voting in election contests; (2) corporate leverage, inside stock ownership by managers, and the control market are interrelated; (3) departures from one share/one vote affect firm value and efficiency; (4) takeover resistance through defensive restructurings or poison pill provisions is associated with declines in share price; and (5) top management turnover is inversely related to share price performance.
Number of Pages in PDF File: 27
Keywords: Agency Costs, Managerial Stock Ownership, Insiders, Outsiders, Control Market, Corporate Performance, One Share/One Vote, Restructuring, Poison Pill Provisions, PerformanceAccepted Paper Series
Date posted: October 11, 2000 ; Last revised: February 24, 2012
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