LBOs And The Reemergence Of Institutional Monitoring Of Managers
Michael C. Jensen
Harvard Business School; Social Science Electronic Publishing (SSEP), Inc.; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI)
LEVERAGED MANAGEMENT BUYOUTS: CAUSES AND CONSEQUENCES, Yakov Amihud, ed., Dow Jones Irwin, Homewood, IL, 1989
The controversy surrounding the so-called LBO issue is a mystery to me because the facts reveal no evidence of a problem. Congressman Markey has said that he wasn't considering a bill to restrict, regulate, or oversee MBOs, and I encourage him to continue down that path. I recommend that Mr. Markey consider adopting for his legislative program one of the principles on which I run my life: If you never miss an airplane, you're getting to the airport too early. I urge his sub-committee not to arrive at the airport the day before the flight's departure, which, in spite of what he says, is what may happen with MBOs. Congressional legislators rarely schedule hearings with the idea that they will do nothing. We should wait to see more than a few LBOs in trouble before we start thinking about further restricting a system that has worked well.
Keywords: LBOs, MBOs, restrictions, monitoring institutions, banks, SEC
JEL Classification: G34, G38Accepted Paper Series
Date posted: October 19, 2005
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
This page was processed by apollo6 in 0.406 seconds