Purpose -In the aftermath of the global financial crisis (GFC) governments lost confidence in market fundamentalism and realised the inadequacies of regulatory measures. The purpose of this paper is to outline the proximate causes of the financial crisis of 2007-2009 and to investigate the role of the shareholder wealth maximization (SWM) objective in the GFC. Design/methodology/approach -The methodological procedure used in this paper is based on the historical case-study approach. Case reviews of individuals and world-level role models of the financial crisis have been cited in this paper. From this aggregated material, the paper examines the side effects of the SWM objective in order to develop the argument that the SWM objective played a role in the present crisis. Findings -The case studies revealed that unethical behaviour, agency issues, CEO compensation, creative accounting and risk shifting are some of the side effects of SWM. These cases indicate that the assumptions on which SWM are based are questionable. Further, it can be argued that the root cause of the GFC is excessive greed and the single-minded pursuit of SWM. Originality/value -Though many studies have attempted to identify the proximate causes of the GFC, this paper is novel in highlighting the impact of the SWM objective function.
The friction induced vibrations are analyzed with the help of a hybrid system which is a "mass on a moving belt". The system considered is a single-degree-of-freedom system which is acting under dry friction state. The system consists of a mass placed on a moving belt which is connected by a spring on one end whereas the other end is fixed. The Coulomb's force due to friction acts at the interface between the mass and the moving belt. The stick-slip regions due to the corresponding change in the mass are found out experimentally.
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