Shareholders Unite

Martin Wolf on Capitalism

To be honest, his views are hardly unique (the come from an approach that emerged in the 1980s known as the resource based view of the company, and his fellow countryman John Kay has expounded these earlier, for instance). But Wolf does make a very good short summary.

It might be somewhat surprising that we agree (we run a website called shareholdersunite), but that market for corporate control is not working very well, and management greediness is really endangering those hard to enforce relational contracts with the employees, threatening to destruct much of the social capital that enables smooth cooperation and coordination with it. Shareholders have a role to play here, keeping managers in check.

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