Research Summary
Research Summary
When Should Control Be Shared?
Description
The right to participate in control is one of the primary instruments for protecting
stakeholder interests in a firm. A basic question is how control should be allocated
across a firm's various stakeholders, including investors, employees, customers, and
suppliers. This question is sometimes framed in terms of ownership: Who should own and
thereby control the firm? In this project, my coauthors, Eva Meyersson Milgrom and Paul Milgrom, and I explore the problems that arise when parties with diverse interests share control. We show that when the distributional consequences of decisions are large, shared control leads to deadlock and delay in decision-making.