Private Equity Can Make Firms More Innovative

Harvard Business Review

And a recent working paper out of the Dusseldorf Institute for Competition Economics ( DICE ), a think tank of sorts, focuses on the latter by exploring whether leveraged buyouts (LBOs) make firms more innovative. PE investors don’t typically invest in firms known for innovation. Startups, on the other hand, aren’t debt financed, because they’re too risky and unproven, and have no assets—not so appealing to lenders.

LBO 9

Crisis of Faith in the Financial System

Harvard Business Review

This pattern of abstracting further and further away from "real" things and "real" value has continued to the present day, giving us credit cards and collateralized debt obligations (not to mention casino chips). The Ming note is printed with the statement that it is "To Circulate for Ever" — quite a vote of confidence from the treasury, and presumably one necessary for such an innovative approach to payment and livelihood. Economy Finance

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What Economists Know That Managers Don’t (and Vice Versa)

Harvard Business Review

To begin with, quite a few parts of it are heavily concentrated at a global level (the credit ratings business, for example, or global investment banking), and many more at the national level (just six financial institutions account for 46% of all U.S. Economy Finance Why did Jean Tirole win the Nobel Prize in Economics?

What Economists Know That Managers Don’t (and Vice Versa)

Harvard Business Review

To begin with, quite a few parts of it are heavily concentrated at a global level (the credit ratings business, for example, or global investment banking), and many more at the national level (just six financial institutions account for 46% of all U.S. Economy Finance Why did Jean Tirole win the Nobel Prize in Economics?

The Real Solution Is Growth

Harvard Business Review

Recent headlines have focused on the debt ceiling , the recent credit rating downgrade , unemployment , and the other thorny fiscal challenges facing the United States. But consider this: increasing the country's average growth rate by one percentage point over the next 20 years would not only result in much higher incomes and more jobs for all Americans but would also obviate the need for drastic spending cuts today to reign in the government deficit. Economy Innovation

Africa’s Unique Opportunity to Promote Inclusive Growth

Harvard Business Review

But with robust growth rates and economies unburdened by legacy structures of the last century, Africans can innovate beyond what others are doing. The African Development Bank (AfDB) is the most visible organization tasked with shepherding that inclusive innovative growth. The AfDB has the strongest credit rating of any organization in Africa and in 2008, it surpassed the World Bank in lending to Africa , a signal of Africa’s growing agency in its own development.