----- Original Message ----- From: "Yoshie Furuhashi" <furuhashi.1 at osu.edu>
> At 8:57 AM -0800 1/27/03, Gar Lipow wrote:
> >The NYT has an example of what I've been talking about - how
> >managers undercut the interests of owners, while not neccesarily
> >benefiting those of workers.
>
> Aren't the sort of CEOs and board members (be they of accounting
> firms or other corporations) who have the ability to undercut the
> interest of other shareholders actually _owners_ themselves,
rather
> than just managers? "On average, a CEO holds about 8 percent of
the
> company's equity" (Cynthia Hobgood, "Highly paid CEOs,"
_Washington
> Business Journal_ August 2, 2002,
>
<http://washington.bizjournals.com/washington/stories/2002/08/05/foc
us5.html>).
> Therefore, the conflict in question here is not between allegedly
> separate classes of "managers" and "owners" but among one faction
of
> owners (owners who actually control firms, accounting or
> non-accounting), another faction of owners (whose incomes mainly
come
> from surplus value but do not individually have controlling
interests
> in particular firms), and nominal "owners" (who are in reality
> non-owners but actually petty producers and proletarians who are
> forced to defer part of their compensation, to have it controlled
by
> actual owner-managers, and worse yet in some cases to have it tied
up
> with the fortune of just one corporation -- the very one that
employs
> them)?
> --
> Yoshie
==========================
It would seem that mainstream economists and some members of the law and economics movement are catching up, almost, with some of the arguments made by the Bearded One. One large difference being what they regard as somewhat anomalous events, he regarded as endemic structural pathologies:
http://repositories.cdlib.org/cgi/viewcontent.cgi?article=1030&conte xt=blewp
Executive Compensation in America: Optimal Contracting or Extraction of Rents? Lucian Arye Bebchuk, Harvard Jesse M. Fried, UC Berkeley David I. Walker, Ropes & Gray
http://business.rutgers.edu/departments/om-papers/mudambi.pdf
Divisional Power within the Firm: Theory and Evidence from Multinational Corporations Ram Mudambi Pietro Navarra
http://post.economics.harvard.edu/faculty/stein/papers/darksideJOFfi nal.pdf
The Dark Side of Internal Capital Markets: Divisional Rent-Seeking and Inefficient Investment David S. Scharfstein Jeremy C. Stein
http://www.law.columbia.edu/law-economicstudies/papers/wp184.pdf
Rents and their Corporate Consequences Mark J. Roe