The Invention of Shareholder Value with Sean Delehanty
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In this episode, Jonathan Brown interviews historian and author Sean Delahanty about his book Company Men: The Invention of Shareholder Value and the Splintering of the American Economy.
Sean explains how dispersed ownership and weak accountability fueled debates over corporate purpose, from New Deal-era corporate social responsibility to 1960s conglomerates and their collapse. He traces how Milton Friedman’s critique, the Efficient Markets Hypothesis, and Jensen and Meckling’s “nexus of contracts” theory helped legitimize shareholder value and hostile takeovers in the 1980s, framing raids as freeing “free cash flow.”
We explore how changing economic theories radically reshaped the American economy and fueled massive accounting scandals like WorldCom.
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