The Corporation versus Tom Cruise | Organizations and Markets

The Corporation versus Tom Cruise

28 August 2006 at 2:13 pm Peter G. Klein Leave a comment

| Peter Klein |

Hollywood studios are standing up to eccentric, pampered stars like Tom Cruise and Lindsay Lohan. At last, says Professor Bainbridge, corporate studios are acting like corporations. “Once again, the public corporation and its norm of shareholder wealth maximization prove to be a force for good.” (Prof. B. is not a fan of stakeholder theory, if you didn’t know.)

On the other hand, if the dependent variable is individual film revenues, rather than film studio market value, the presence (and presumably behavior) of particular stars seems to have little impact on performance. So says Art DeVany (via Marginal Revolution).

Entry filed under: - Klein -, Management Theory, Theory of the Firm.

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