A Comparison of Managers’ Perception of Short-Termism in Finland, Sweden and the U.S

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International Journal of Production Economics, 2009, Vol 117, pp. 427-438

Title: A Comparison of Managers’ Perception of Short-Termism in Finland, Sweden and the U.S
Author: Liljeblom, Eva; Vaihekoski, Mika
Abstract: Increased media exposure to layoffs and corporate quarterly financial reporting have created arguable a common perception – especially favored by the media itself – that the companies have been forced to improve their financial performance from quarter to quarter. Academically the relevant question is whether companies themselves feel that they are exposed to short-term pressure to perform even if it means that they have to compromise company’s long-term future. This paper studies this issue using results from a survey conducted among the 500 largest companies in Finland. The results show that companies in general feel moderate short-term pressure, with reasonable dispersion across firms. There seems to be a link between the degree of pressure felt, and the firm’s ownership structure, i.e. we find support for the existence of short-term versus long-term owners. We also find significant ownership related differences, in line with expectations, in how such short-term pressure is reflected in actual decision variables such as the investment criteria used.
URI: http://hdl.handle.net/10227/776
Date: 2010-12-31
Subject: impatience
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