Agency

Working Paper

Private Benefits and Corporate Investment and Financing Decisions: The Case of Corporate Philanthropy

We find that corporate giving as a private benefit of control distorts investment and financing decisions, results supporting Jensen’s (1986) free cash flow theory. These investment distortions reduce shareholder wealth, especially in cash-...Read more

Ronald Masulis
05 April 2019

The Agency Costs of Activism: Information Leakage, Thwarted Majorities, and the Public Morality

Few doubt that hedge fund activism has radically changed corporate governance in the United States -- for better or for worse. Proponents see activists as desirable agents of change who intentionally invest in underperforming
companies to...Read more

John Coffee
22 November 2017

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