Price theory or the theory of competitive equilibrium

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: the theory of competitive equilibrium): What about value maximizing and social welfare? o Social welfare is maximized when all firms in an economy attempt to maximize their own total firm value Value Maximization, Stakeholder Theory and the Corporate Objective Function (Jensen 2001) Stakeholder theory and implications for managers and directors - shortcomings o No principled criteria for decision making; favorite causes expand power of managers, increase agency costs What does Jensen term “enlightened” value maximization? What are Jensen’s misgivings about the Balanced Scorecard Value Maximization, Stakeholder Theory and the Corporate Objective Function (Jensen 2001) Do you think there is a better corporate objective than shareholder value? To what extent can we ensure that corporations behave in a socially desirable way? Balanced scorecard Balanced by Kaplan and Norton HBR(1992) by Goal identification and Goal implementation implementation – Translating the vision into Translating operational goals; operational – Communicating the vision Communicating and link it to individual performance; performance; – Business planning; index Business setting setting – Feedback and learning, Feedback and adjusting the strategy accordingly. accordingly. Four...
View Full Document

Ask a homework question - tutors are online