The Corporate Financiers
Subtitle: Williams, Modigliani, Miller, Coase, Williamson, Alchian, Demsetz, Jensen and Meckling
By: Colin Read, Professor of Economics, SUNY College at Plattsburgh, USA
Series: Great minds in finance
Publisher: Palgrave Macmillan; Springer
Published: 2015
Place of publication: New York
Language: eng
Number of pages: 243
ISBN-13: 9781137341273
Subjects: Corporations; Finance; Capitalists and financiers; Biography; Economics; History; BUSINESS & ECONOMICS / Corporate Finance; BUSINESS & ECONOMICS / Finance; BUSINESS & ECONOMICS / Economics / Theory
Description: "The Corporate Financiers is the fifth book in a series of discussions about the great minds in the history and theory of finance. While the series addresses the contributions of scholars in our understanding of modern finance, this volume presents the ways in which a corporation creates value. More than two centuries ago, Adam Smith explained the concept of division of labor and the efficiencies of specialization as the mechanism in which a firm creates value. However, corporations now find themselves outsourcing some processes to other firms as an alternative way to create value. There must be other economic forces at work than simply the internal efficiencies of a firm. We begin by describing the work of a rather obscure scholar named John Burr Williams who demonstrated in 1938 how the earnings of a firm are capitalized into corporate value through its stock price. We then delve into the inner workings of the modern corporation by describing the contributions of Nobel Memorial Prize winners Ronald Coase and Oliver Williamson. More than any others, these scholars created a renewed appreciation for our understanding of the institutional detail of the modern corporation in reducing costs and increasing efficiency. While Coase and Williamson provided meaningful descriptions of the advantage of a corporation, they did not offer prescriptions for the avenues the corporation can create more value in an era when new technologies make outsourcing and telecommuting increasingly possible. Michael Jensen and William Meckling describe in greater detail the nature of the implicit contracts a corporation employs, and recommend remedies to various problems that arise when the goals of the corporation are not aligned with the incentives of its agents. We also describe the further nuances to these relationships as offered by Armen Alchian and Harold Demsetz. We treat the lives of these extraordinary individuals who looked at a very familiar problem in a sufficiently novel light to change the way all look at corporations ever since. That is the test of genius"--
Notes: Includes bibliographical references (pages 221-227) and index.
Table of contents: title: Machine generated contents note:; title: 1. IntroductionPART I: FROM ART TO SCIENCE2. A Fly in the Ointment3. The Early Life of John Burr Williams4. The Times and the Theory5. A New Finance Paradigm6. Legacy and Later LifePART II: IS A CORPORATION'S CAPITAL STRUCTURE IRRELEVANT?7. The Early Years of Franco Modigliani8. The Early Years of Merton Miller9. The Times10. The Great Idea11. Applications12. The Prize13. The Later Years of Merton Miller14. The Later Years of Franco ModiglianiPART III: TRANSACTIONS COSTS AND THE VALUE OF A FIRM15. The Early Life of Ronald Harold Coase16. The Times and the Theory17. Life and Legacy18. The Early Life of Oliver Eaton Williamson19. The Times and the Theory20. Applications21. Life and Legacy22. Life and Legacy of Oliver WilliamsonPART IV: ALCHIAN AND DEMSETZ23. Alchian and Demsetz24. Harold Demsetz25. The Times26. The Great Idea27. Applications and Extensions28. Harold Demsetz Later in Life29. The Later Years of Armen AlchianPART V: JENSEN AND MECKLING30. The Early Years for Michael Cole Jensen31. The Early Years for William Henry Meckling32. The Times33. The Theory34. Applications and Extensions35. Life and LegacyPART VI: WHAT WE HAVE LEARNED36. Combined contributions37. Conclusions.