A theory of board control and size

• 成果类型: Article
• 署名作者: Harris, Milton; Raviv, Artur
• 署名单位: University of Chicago; Northwestern University
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhl030
• 发表日期: 2008
• 页码: 1797
• 关键词: Incentives; DIRECTORS

摘要

This article presents a model of optimal control of corporate boards of directors. We determine when one would expect inside versus outside directors to control the board, when the controlling party will delegate decision-making to the other party, the extent of communication between the parties, and the number of outside directors. We show that shareholders can sometimes be better off with an insider-controlled board. We derive endogenous relationships among profits, board control, and the number of outside directors that call into question the usual interpretation of some documented empirical regularities.