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Shareholder value orientation, distribution and growth - short- and medium-run effects in a Kaleckian model

Hein, Eckhard (2008) Shareholder value orientation, distribution and growth - short- and medium-run effects in a Kaleckian model. Department of Economics Working Paper Series, 120. Inst. für Volkswirtschaftstheorie und -politik, WU Vienna University of Economics and Business, Vienna.

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Abstract

We discuss the effects of rising shareholder power on distribution and capital accumulation in a Kaleckian model. Increasing shareholder power is associated with decreasing managements' animal spirits, on the one hand, and increasing dividends distributed to shareholders, on the other hand. In the short run, increasing shareholder power may either have positive ('finance-led'), negative ('normal') or intermediate ('profits without investment') effects on capacity utilisation, profits and capital accumulation. In the medium run, the positive ('finance-led') effects may be maintained in a stable environment under very special conditions, whereas the negative ('normal') and the intermediate ('profits without investment') effects turn into cumulative disequilibrium processes with falling rates of capacity utilisation, profits and capital accumulation and rising debt- and rentiers' equity-capital-ratios. (author´s abstract)

Item Type: Paper
Keywords: Shareholder value orientation / distribution / growth / Kaleckian models
Classification Codes: RVK QC 210 ; JEL E12, E21, E22, E25, E44
Divisions: Departments > Volkswirtschaft
Depositing User: Repository Administrator
Date Deposited: 31 Mar 2008 15:36
Last Modified: 25 Dec 2014 14:39
URI: http://epub.wu.ac.at/id/eprint/930

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