Study Document
Comparison of Governance Structure and Types of Capitalism Term Paper
Pages:2 (571 words)
Sources:1
Subject:Economics
Topic:Capitalism
Document Type:Term Paper
Document:#14556088
stakeholder capitalism and shareholder capitalism?
Under what conditions might stakeholder capitalism be superior to shareholder capitalism? Why is this?
How do ideas about how markets economies operate influence the form of corporate governance in a country or region?
What is the primary difference between H-mode firms and J-mode firms, and which type of firm tends to perform better over the long-term?
PREPARE YOUR ANSWERS TO THESE QUESTIONS.
Shareholder capitalism is focuses on the interests of shareholders, a factor that is deterministically influential with respect to corporate governance, mission, and values. Stakeholder capitalism establishes forms of corporate governance and identifies corporate missions and values that engage in the pursuit of the interests of all stakeholders. When considering how capitalism is expressed in various countries, it becomes clear that the overarching difference is that firms in the U.S. And the UK are designed in a manner that enables the creation of wealth for shareholders. Accordingly, in France, Germany, and Japan, say, firms are considered to be groups of people who work together for their own common benefit.
2. Stakeholder capitalism can result in superior results when the markets are not complete or perfect. However, it is important to recognize that the overarching Arrow-Debreu model is based on a number of robust assumptions that include, symmetric information, efficient frontier, perfect and complete markets, perfect competition, and so on. The realities of economies may be ignored, in part because they do not align with the model's many assumptions.
3. Historically, the invisible hand construct of Adam Smith undergirds shareholder capitalism. Smith's ideas have evolved into a model known as Arrow-Debreu and fundamental economic theorems. This economic perspective holds that a corporation must assume a role in society…
Sample Source(s) Used
References
Allan, F. & Gale, D. (2002, December 22). A comparative theory of corporate governance. Wharton, Financial Institutions Center.
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