The Governance of the New Enterprise

45 Pages Posted: 11 Oct 2000 Last revised: 1 Oct 2022

See all articles by Raghuram G. Rajan

Raghuram G. Rajan

University of Chicago - Booth School of Business; International Monetary Fund (IMF); National Bureau of Economic Research (NBER)

Luigi Zingales

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Date Written: October 2000

Abstract

The changing nature of the corporation forces us to re-examine much of what we take for granted in corporate governance. What precisely is the entity that is being governed? How does the governance system obtain power over it, and what determines the division of power between various stakeholders? And is the objective of allocating power only to enhance the returns of outside investors? In this paper we argue that, given the changing nature of the firm, the focus of corporate governance must shift from alleviating the agency problems between managers and shareholders to studying mechanisms that give the firm the power to provide incentives to human capital. We also provide some examples of the kind of subjects that should now be the main focus of study in corporate governance.

Suggested Citation

Rajan, Raghuram G. and Zingales, Luigi, The Governance of the New Enterprise (October 2000). NBER Working Paper No. w7958, Available at SSRN: https://ssrn.com/abstract=245587

Raghuram G. Rajan (Contact Author)

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-4437 (Phone)
773-702-0458 (Fax)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States
773-702-9299 (Phone)
773-702-0458 (Fax)

Luigi Zingales

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-3196 (Phone)
773-834-2081 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
350
Abstract Views
6,443
Rank
156,827
PlumX Metrics