Are U.S. Companies Too Short-Term Oriented? Some Thoughts

23 Pages Posted: 23 May 2017  

Steven N. Kaplan

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: May 22, 2017

Abstract

U.S. companies are often criticized for being overly short-term oriented. This paper documents that those criticisms have a long history, going back at least thirty-five years. The paper then considers the implications of sustained short-termism for corporate profits, venture capital investments and returns, private equity investments and returns, and corporate valuations. The paper finds little long-term evidence that is consistent with the predictions of the short-term critics.

Keywords: Short-Termism, Investment, Innovation

JEL Classification: D24, G31, L25

Suggested Citation

Kaplan, Steven Neil, Are U.S. Companies Too Short-Term Oriented? Some Thoughts (May 22, 2017). Available at SSRN: https://ssrn.com/abstract=2972117 or http://dx.doi.org/10.2139/ssrn.2972117

Steven Neil Kaplan (Contact Author)

University of Chicago - Booth School of Business ( email )

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Chicago, IL 60637
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773-702-4513 (Phone)
773-702-0458 (Fax)

National Bureau of Economic Research (NBER)

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