bwaber@bookwyrm.social reviewed Grow the Pie by Alex Edmans
A Generic, Naive Economics Perspective
3 stars
This book essentially lays out the naive neoliberal economic consensus on why companies should be managed to deliver for multiple stakeholders. The issue here isn't with the hypothesis, it's that Edmans repeats standard economic dogma on the theory of the firm and management that have zero empirical backing and are hilariously wrong. This particularly stands out when discussing executive compensation, neglecting analyses demonstrating that this is not a healthy market by any definition, conflicts of interest, and the question of how much one needs to pay to motivate people/how much better they are than other people. Given that we literally don't know, it's dishonest to defend these practices. If you've read a book or even a few columns on why companies should aim for more than short term profit, you already know what's in this book.
This book essentially lays out the naive neoliberal economic consensus on why companies should be managed to deliver for multiple stakeholders. The issue here isn't with the hypothesis, it's that Edmans repeats standard economic dogma on the theory of the firm and management that have zero empirical backing and are hilariously wrong. This particularly stands out when discussing executive compensation, neglecting analyses demonstrating that this is not a healthy market by any definition, conflicts of interest, and the question of how much one needs to pay to motivate people/how much better they are than other people. Given that we literally don't know, it's dishonest to defend these practices. If you've read a book or even a few columns on why companies should aim for more than short term profit, you already know what's in this book.