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CEOs Don’t Care Enough About Capital Allocation

Harvard Business Review

It’s been more than 50 years since Nobel prizewinners Franco Modigliani and Merton Miller identified return on investments as a major component of value creation (and value destruction). As the chart below shows, only half of the CEOs of companies in the Dow Jones Index have previous experience in corporate finance or strategy.

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What an Economist Brings to a Business Strategy

Harvard Business Review

In the 1900s, French mathematician-economist Leon Walras envisioned prices in a market economy being set by an auctioneer (since known as the “Walrasian auctioneer”) conducting continuous auctions for all kinds of commodities. Economists and market design. Economists and finance.

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The Irish Banking Crisis: A Parable

Harvard Business Review

In slightly more formal terms, Id suggest that they were able to take on, at least in tiny part, five of Robert Merton and Zvi Bodies six standard functions of a financial system: settling payments, providing information, setting incentives, pooling resources, and transferring resources.

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