A key organizational feature of large United States corporations is the separation of ownership from control. This separation creates an agency problem, that managers may run the firm in their own, rather than the shareholders' interest, choosing the quiet life over the maximization of share value. In the 1980s, corporate takeovers provided a measure of discipline by threatening poor performers with replacement by bidders who would reunite ownership and control.' With the lull in takeovers in the 1990s, commentators concerned about corporate performance have turned their attention to identifying alternative mechanisms for disciplining management. The principal solution has been to call for more active monitoring of management by institutional investors. 2 The focus has been on a subset of these investors, public pen
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