Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/105889
Authors: 
van Treeck, Till
Year of Publication: 
2007
Series/Report no.: 
IMK Working Paper 6/2007
Abstract: 
This article is centred around the notions of shareholder value orientation and financialisation. Shareholder value orientation is reflected by a high dividend payout ratio applied by firms and the reluctance of firms to finance physical investment via new equity issues. Financialisation is the more general development towards an increased importance of the financial sector of the economy relative to the non-financial sector. In this article, a synthetic, stock-flow consistent model is developed that attempts to encompass and at times adjust some important recent works on the effects of financialisation. This includes contributions from the fields of mainstream information economics and Post Keynesian economics. We conduct simulations reflecting increased shareholder value orientation and show that the model produces a number of results that appear consistent with many stylised facts particularly of the US economy since the early 1980s.
Subjects: 
Stocks and Flows
Corporate Governance
Investment Finance
Payout Policy
Income Distribution
JEL: 
E10
E21
D14
G11
G32
G35
E25
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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