Strong Corporate Culture Leads to Strong Performance

It pays for a company to keep its word. Research suggests that companies with strong corporate culture have higher long-term returns.

Editor’s Note: I didn’t find the research, at least as portrayed in the article, to be too convincing, but the topic and concept are interesting and worth considering.

Preventing Economists’ Capture

Late Chicago Booth Professor (and Nobel Laureate) George Stigler pioneered the concept of regulatory capture. In simple words, regulatory capture exists when a regulatory agency, created to act in the public interest, ends up advancing interests of the industry it is charged with regulating. Since Stigler, when economists talk about regulatory capture, they do not imply that regulators are corrupt or lack integrity. In fact, … [ Read more ]

The Future of Securities Regulation

The U.S. system of security law was designed more than 70 years ago to regain investors’ trust after a major financial crisis. Today we face a similar problem. But while in the 1930s the prevailing perception was that investors had been defrauded by offerings of dubious quality securities, in the new millennium, investors’ perception is that they have been defrauded by managers who are not … [ Read more ]

Who Do You Trust?

A degree of mutual trust is an essential component of any economic exchange.Recent research suggests that this trust is not only based on objective considerations of trustworthiness, but is also affected by cultural heritage. This cultural bias in trust has important effects on global trade and investments.

The Court of Public Opinion

The media plays a crucial role in shaping the public image of corporate managers, and in doing so can pressure them to behave according to social norms.

Beyond the Protestant Work Ethic

New research suggests a link between religion and attitudes that are conducive to economic growth.

Saving Capitalism from the Capitalists

Capitalism’s biggest problem is the executive in pinstripes who extols the virtues of competitive markets with every breath while attempting to extinguish them with every action.

Saving Capitalism from the Capitalists is a groundbreaking book that will radically change our understanding of the capitalist system, particularly the role of financial markets. They are the catalyst for inspiring human ingenuity and spreading prosperity. The perception of many, … [ Read more ]

The Value of Control

U.S. corporate scandals such as Enron and Tyco have highlighted the fact that insiders enjoy benefits above and beyond those of the average shareholder-the so-called “private benefits of control.” How widespread are these benefits? What effects do they have on the development of a country’s securities market? Furthermore, how can such benefits be curbed? New research indicates that in spite of the recent corporate scandals … [ Read more ]