Corporate Governance and Neoclassical Economics |
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Authors: | Dennis C. Mueller |
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Affiliation: | 1. University of Vienna, Oskar Morgenstern-Platz 1, A-1090, Vienna, Austriadennis.mueller@univie.ac.at |
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Abstract: | AbstractAlthough the term “corporate governance” is relatively new in the economist’s lexicon, the issues with which it is concerned are as old as the profession itself. In this article, first I try to illustrate this, and then I trace the development of the literature, including discussions of the so-called managerial discretion literature and the principal–agent literature. Following a discussion of asset bubbles, I illustrate the tension between concerns about corporate governance and neoclassical economics by examining the literature on managerial compensation and mergers. This literature reveals a wide gap between traditional neoclassical economics and more recent developments in behavioral economics. |
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Keywords: | Behavioral Bubbles Compensation Mergers Neoclassical |
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