Journal of Applied Corporate Finance最新文献

{"title":"The modern industrial revolution, exit, and the failure of internal control systems","authors":"Michael Jensen","doi":"10.1111/jacf.12624","DOIUrl":"https://doi.org/10.1111/jacf.12624","url":null,"abstract":"","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 3","pages":"52-66"},"PeriodicalIF":0.7,"publicationDate":"2024-10-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142707487","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Mike Jensen on CEO pay","authors":"Kevin J. Murphy","doi":"10.1111/jacf.12625","DOIUrl":"https://doi.org/10.1111/jacf.12625","url":null,"abstract":"<p>When I joined the University of Rochester's Graduate School of Management (now the Simon School) as a newly minted assistant professor in January 1984, my thesis advisors from the Chicago Economics Department warned me to be wary of Michael Jensen, the most prominent and influential faculty member at the school. Their well-intended warnings proved unnecessary: in short order, Mike became my mentor, co-author, colleague, and life-long (if not always uncomplicated) friend.</p><p>By the early 1980s, Mike and Bill Meckling's 1976 paper “Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure” was already generally recognized as establishing the leading paradigm for empirical corporate finance. Largely missing from the Jensen-Meckling treatise, however, was the role that executive incentive contracts play, or could play, in limiting the cost of agency conflicts between managers and shareholders. Mike became highly intrigued by executive compensation and, along with colleague Jerry Zimmerman (co-founding editor of the <i>Journal of Accounting and Economics</i>), organized the “Conference on Management Compensation and the Managerial Labor Market” in April 1984, whose proceedings were published as a special issue of the <i>JAE</i> in 1985. The conference—and the Jensen-Meckling paradigm—helped launch executive compensation as a legitimate topic of academic research in accounting, finance, and economics.</p><p>My personal contribution to the April 1984 conference was using time-series data with executive fixed effects to uncover a statistically positive pay-performance <i>elasticity—</i>which I measured as the percentage change in compensation associated with a percentage change in the value of the firm. While acknowledging the statistical significance, Mike kept pushing on the question of the <i>economic significance</i> of my finding: was the estimated elasticity really large enough to provide meaningful incentives? We developed a construct we called the <i>pay-performance sensitivity</i> that measured the “effective ownership share” akin to the manager's ownership share in Jensen-Meckling, but included all the sources of incentives we could find useful data about (including stock and option holdings, bonuses, and year-to-year salary adjustments, as well as the probability of performance-related terminations). In our 1990 <i>Journal of Political Economy</i> article, we concluded that the wealth of a typical CEO changes by only $3.25 for every $1000 change in shareholder wealth, hardly enough to get CEOs to take projects that increase shareholder wealth and avoid projects that decrease shareholder wealth.1</p><p>Mike and I considered as many explanations as we could find or think of for what we believed were unexpectedly low observed pay-performance sensitivities, including risk aversion, limits to credible contracting, imperfect performance measurement, and CEO production functions. We concluded that the most plausible explanat","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 3","pages":"92-94"},"PeriodicalIF":0.7,"publicationDate":"2024-10-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/jacf.12625","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142707472","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Two CEO pay challenges that Mike Jensen has left us to keep working on","authors":"Stephen F. O'Byrne","doi":"10.1111/jacf.12626","DOIUrl":"https://doi.org/10.1111/jacf.12626","url":null,"abstract":"","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 3","pages":"111-116"},"PeriodicalIF":0.7,"publicationDate":"2024-10-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142707467","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Misreading Michael Jensen: The case of Nicholas Lemann's Transaction Man: The Rise of The Deal and The Decline of The American Dream","authors":"Don Chew","doi":"10.1111/jacf.12618","DOIUrl":"https://doi.org/10.1111/jacf.12618","url":null,"abstract":"","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 3","pages":"16-24"},"PeriodicalIF":0.7,"publicationDate":"2024-09-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142707971","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Baylor University roundtable on the corporate mission, CEO pay, and improving the dialogue with investors","authors":"Don Chew","doi":"10.1111/jacf.12619","DOIUrl":"https://doi.org/10.1111/jacf.12619","url":null,"abstract":"","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 3","pages":"25-40"},"PeriodicalIF":0.7,"publicationDate":"2024-09-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142708330","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Michael Jensen's contributions to the theory of the firm: A tribute in three acts","authors":"Bartley J. Madden, Douglas E. Stevens","doi":"10.1111/jacf.12620","DOIUrl":"10.1111/jacf.12620","url":null,"abstract":"<p>Michael Cole Jensen (1939–2024) passed away on April 2, 2024 in Sarasota, Florida. A number of fitting tributes have appeared celebrating the life of one of the world's most productive and influential financial economists. A tribute to Jensen by Eugene Fama on the University of Chicago website <i>ProMarket</i> emphasizes how Jensen's research contributions put him in the highest echelons of academic finance and economics. Fama cites several of Jensen's seminal papers, including his 1976 paper coauthored with William Meckling, “Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure.”1 Jensen's paper with Meckling became the most heavily cited paper in the corporate finance literature and established agency theory as the dominant theory of the firm in finance and accounting. Fama also highlights Jensen's role in the transformation of finance into a scientific discipline, noting that he founded the <i>Journal of Financial Economics</i> in 1974 and edited it for over 20 years to drag the <i>Journal of Finance</i> “into the era of scientific research.” Finally, Fama highlights Jensen's leadership and foresight in launching the Social Science Research Network (SSRN) in 1994 to advance research across the social sciences.2</p><p>Another tribute to Jensen on <i>ProMarket</i> by Cambridge Law Professor Brian Cheffins suggests that Jensen's thinking on the public corporation underwent a 180-degree turn. In Cheffins's account, Jensen began his career as a strong advocate of the corporation as a driver of innovation and growth in the economy, calling it “an awesome social invention” in his seminal article with Meckling. After the economic stagnation and rampant inflation of the 1970s, however, Jensen allegedly became a fierce critic of the corporation, expressing skepticism about internal corporate systems and emphasizing the effectiveness of the market for corporate control to discipline manager opportunism. Cheffins highlights Jensen's promotion of the corporate takeover boom of the 1980s and the proliferation of incentive pay for executives based on stock options and earnings targets.</p><p>When the takeover boom suddenly halted in the 1990s, Cheffins notes that Jensen blamed executives and politicians who had put up roadblocks to corporate takeovers. Jensen also criticized self-serving managers and compliant boards who had used incentive pay to shield executives from market risk while adding significantly to their total compensation. Yet, public corporations continued to grow in number and size and were a major contributor to strong economic growth and soaring stock prices throughout the 1990s. But in Cheffins’ view, for all the accomplishments of US public companies, “there would be no reversal of Jensen's 180 degree turn regarding the public company.”3</p><p>In contrast to prior tributes, we focus on Jensen's contributions to the theory of the firm over his illustrious career. We argue that his contributions in this area repre","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 3","pages":"117-125"},"PeriodicalIF":0.7,"publicationDate":"2024-09-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/jacf.12620","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142188253","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Michael C. Jensen: Scholar, mentor, colleague","authors":"Clifford W. Smith","doi":"10.1111/jacf.12616","DOIUrl":"10.1111/jacf.12616","url":null,"abstract":"","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 3","pages":"9-15"},"PeriodicalIF":0.7,"publicationDate":"2024-09-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142188252","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"A message from the editor","authors":"Don Chew","doi":"10.1111/jacf.12617","DOIUrl":"10.1111/jacf.12617","url":null,"abstract":"","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 3","pages":"2-4"},"PeriodicalIF":0.7,"publicationDate":"2024-08-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142188181","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"A message from the Editors","authors":"John McCormack","doi":"10.1111/jacf.12614","DOIUrl":"10.1111/jacf.12614","url":null,"abstract":"","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 2","pages":"2-4"},"PeriodicalIF":0.7,"publicationDate":"2024-07-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141571945","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Executive summaries","authors":"","doi":"10.1111/jacf.12615","DOIUrl":"10.1111/jacf.12615","url":null,"abstract":"","PeriodicalId":46789,"journal":{"name":"Journal of Applied Corporate Finance","volume":"36 2","pages":"5-7"},"PeriodicalIF":0.7,"publicationDate":"2024-07-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141571946","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}