How government transferred value from shareholders to managers

by Walter Olson on November 7, 2013

Marc Hodak: “The golden parachute became popular after passage of the Williams Act [of 1968, which insulated managements against "hostile" takeover offers] because the Act effectively gave CEOs a veto over the acquisition of their firm. … Note that this ‘rent extraction,’ as it’s termed by economists, was not the result of managerial power granted by a lazy or corrupt board to a greedy CEO. This was managerial power created by law.”