Econ 349
Corporate Governance Seminar

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Agency Problem Set
Essays

Reading List
Highlighted items are required reading. All others are optional. Also, the range of pages given is often a subset of the entire article. See Ella for access to documents that do not have links.

Websites

• Harvard Law Corporate Governance Blog
• New York Times Dealbook

Week 1 - The Corporation and Corporate Governance

• Apple Inc. Corporate Bylaws
• American Bar Foundation. Model Business Corporation Act. (2006) pp. 861
• Demski. Corporate conflicts of interest. Journal of Economic Perspectives (2003) vol. 17 (2) pp. 51-72
• Shleifer and Vishny. A Survey of Corporate Governance. Journal of Finance (1997) vol. 52 (2) pp. 737-740
• Op. Ed., U.S. Corporate Governance Today: A Reshaping of Capitalism

Week 2 - Agency Theory

• Holmstrom. Moral Hazard and Observability. The Bell Journal of Economics (1979) vol. 10 (1) pp. 74-91
• Holmstrom. Moral Hazard in Teams. The Bell Journal of Economics (1982) vol. 13 (2) pp. 324-340
• Laffont and Rochet. Collusion in Organizations. Scandinavian Journal of Economics (1997) vol. 99 (4) pp. 485-495
• Tirole. Hierarchies and Bureaucracies: On the Role of Collusion in Organizations. Journal of Law, Economics, & Organization (1986) vol. 2 (2) Sections 1,2,5

Week 3 - Agency Theory

• Fama. Agency Problems and the Theory of the Firm. Journal of Political Economy (1980) vol. 88 (2) pp. 288-307
• Shleifer and Vishny. A Survey of Corporate Governance. Journal of Finance (1997) vol. 52 (2) pp. 740-748
• Baker. Incentive Contracts and Performance Measurement. Journal of Political Economy (1992) vol. 100 (3) pp. 598-614
• Kohn. Why Incentive Plans Cannot Work. Harvard Business Review (1993)
• Baker et al. Compensation and Incentives: Practice vs. Theory. Journal of Finance (1988) vol. 43 (3) pp. 593-616
• Murphy. Executive Compensation. SSRN (1999)

Week 4 - Executive Compensation

• Aggarwal and Samwick. The Other Side of the Trade-Off: The Impact of Risk on Executive Compensation. Journal of Political Economy (1999) vol. 107 (1) pp. 65-105
• Bertrand and Mullainathan. Are CEOS Rewarded for Luck? The Ones without Principals Are. Quarterly Journal of Economics (2001) vol. 116 (3) pp. 901-932
• Bertrand and Mullainathan. Enjoying the quiet life? Corporate governance and managerial preferences. Journal of Political Economy (2003) vol. 111 (5) pp. 1043-1075
• Gabaix and Landier. Why Has CEO Pay Increased So Much?. The Quarterly Journal of Economics (2008) vol. 123 (1) Introduction and Conclusion

Week 5 - Executive Compensation

• Shapiro. Who Really Will Pay for Goldman Sachs' $23 Billion in New Bonuses. 2009.
• Goldman Sachs. Goldman Sachs' Compensation Principles
• Goldman Sachs. Goldman Sachs Pays $1.1 Billion to Redeem TARP Warrants. 2009.
• Gawker. Announcing the Goldman Project. 2009.

Week 6 - Board of Directors

• Adams and Ferreira. Women in the Boardroom and Their Impact on Governance and Performance. SSRN (2008)
• Joy et al. The Bottom Line: Corporate Performance and Women's Representation on Boards. Catalyst (2007)
• Linck et al. The Determinants of Board Structure. Journal of Financial Economics Forthcoming (2007)
• Boone et al. The determinants of corporate board size and composition: An empirical analysis. Journal of Financial Economics (2007) vol. 85 (1) pp. 66-101

Week 7 - Board of Directors

• Hermalin and Weisbach. Endogenously Chosen Boards of Directors and Their Monitoring of the CEO. American Economic Review (1998) vol. 88 (1) pp. 96-118
• Harris and Raviv. A Theory of Board Control and Size. Review of Financial Studies (2008) vol. 21 (4) pp. 1797-1832
• Adams and Ferreira. A Theory of Friendly Boards. Journal of Finance (2007) vol. 62 (1) pp. 217-250
• Hermalin and Weisbach. Boards of Directors As an Endogenously Determined Institution: A Survey of the Economic Literature, Economic Policy Review. Federal Reserve Bank of New York (2003) vol. 9 pp. 7-26

Week 8 - Board of Directors

• Securities and Exchange Commission. SEC Release 34-56914. (2008)
• Grundfest. Internal Contradictions in the SEC's Proposed Proxy Access Rules. Working Paper (2009)
• Fischer et al. Uncontested Director Election Results and Board Performance. Working Paper (2008)
• Walter. Speech by SEC Commissioner: SEC Rulemaking - 'Advancing the Law' to Protect Investors. (2009)
• Securities and Exchange Commission. Facilitating Shareholder Director Nominations. (2009)

Week 9 - Takeovers

• Greenwood and Schor. Investor Activism and Takeovers. Journal of Financial Economics (2009) vol. 92 (3) pp. 362-375
• Martynova and Renneboog. A Century of Corporate Takeovers: What Have We Learned and Where Do We Stand? Journal of Banking and Finance (2008) vol. 32 pp. 2148-2177
• Offer by Kraft Foods for Cadbury Plc
• Casares Field and Karpoff. Takeover Defenses of IPO Firms. Journal of Finance (2002) vol. 57 (5) pp. 1857-1889

Week 10 - Stakeholder Rights

• Gates. A New Approach to Capitalism in the 21st Century. Speech, World Economic Forum (2008)
• Posner. Bill Gates on Corporate Philanthropy. The Becker-Posner Blog (2008)
• Becker. On Corporate Altruism. The Becker-Posner Blog (2008)

Week 11 - Crisis and Regulation

• Tarullo. Confronting Too Big to Fail. Speech, (2009)
• St. Louis Fed. Financial Crisis Timeline (2009)
• Lowenstein. Triple-A Failure. New York Times (2008)
• Weissman. Deregulation and the FInancial Crisis. The Huffington Post (2008)
• Dreck. Derivatives and Regulation. Asymmetrical Information Blog (2002)