Are U.S. Companies Too Short-Term Oriented? Some Thoughts

23 Pages Posted: 23 May 2017

See all articles by Steven N. Kaplan

Steven N. Kaplan

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI); University of Chicago - Polsky Center for Entrepreneurship

Multiple version iconThere are 3 versions of this paper

Date Written: May 22, 2017

Abstract

U.S. companies are often criticized for being overly short-term oriented. This paper documents that those criticisms have a long history, going back at least thirty-five years. The paper then considers the implications of sustained short-termism for corporate profits, venture capital investments and returns, private equity investments and returns, and corporate valuations. The paper finds little long-term evidence that is consistent with the predictions of the short-term critics.

Keywords: Short-Termism, Investment, Innovation

JEL Classification: D24, G31, L25

Suggested Citation

Kaplan, Steven Neil, Are U.S. Companies Too Short-Term Oriented? Some Thoughts (May 22, 2017). Available at SSRN: https://ssrn.com/abstract=2972117 or http://dx.doi.org/10.2139/ssrn.2972117

Steven Neil Kaplan (Contact Author)

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-4513 (Phone)
773-702-0458 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

European Corporate Governance Institute (ECGI) ( email )

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

University of Chicago - Polsky Center for Entrepreneurship

Chicago, IL 60637
United States

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

Paper statistics

Downloads
677
Abstract Views
4,580
Rank
56,452
PlumX Metrics