Brad DeLong provides a useful summary of recent fads in financial organisation and corporate control. It should be essential reading every time someone tells you there’s a unique path to virtue in corporate structure.
“The Japanese Model: Remember the Japanese model? The days when Japan’s version of the German ‘universal bank’ system — the keiretsu — was the clearly superior mode of financial organization and mechanism of corporate control? When it allowed for effective corporate supervision and patient capital? How the short-termism of Wall Street was destroying American industry?
“The Eclipse of the Public Corporation: Remember Michael Jensen and the eclipse of the public corporation? The claim that the public corporation with diversified shareholding was an outmoded, obsolete, disfunctional form of corporate organization?
“Takeovers as Salvation: Takeovers to keep boards and managers on their toes…
“The Venture Capital-Fed Entrepreneurial Genius of Silicon Valley: In which we talk about how big companies can’t innovate, and how American venture capitalists are the key intermediaries in promoting worldwide economic growth.
“Triumphalist Anglo-Saxon Equity Diversification and Transparency: In which we talk about how countries that do not adopt Anglo-American-style financial markets are doomed to high costs of capital and to being shunned by worldwide investors.
“The Post-Bubble Economy: In which we talk about how the insane gyrations of Wall Street and its overvaluation of telecom stocks forced us to waste $80 billion dollars digging holes in which to place still-unlit fiber-optic cables.”
“What’s the difference between terrorists and protocol? You can always negotiate with terrorists.” Jordan’s King Abdullah quoted in The New York Times.