University of Cambridge > Talks.cam > Finance Seminars, CJBS > EXIT VS. VOICE

EXIT VS. VOICE

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  • UserLuigi Zingales, Robert C. McCormack Distinguished Service Professor of Entrepreneurship and Finance and the Charles M. Harper Faculty Fellow at the University of Chicago Booth School of Business.
  • ClockTuesday 03 November 2020, 13:00-14:00
  • HouseWebinar (via Zoom online).

If you have a question about this talk, please contact Emily Brown.

To join the seminar, register and join the Zoom meeting and enter the meeting ID. Meeting ID: 917 5002 8841 Password: 386866. https://jbs-cam.zoom.us/j/91750028841?pwd=cG91T2Jhbis1K0Rrc09ta24vUm1BUT09

We study the relative effectiveness of exit (divestment and boycott) and voice (engagement) strategies in promoting socially desirable outcomes in companies. We show that in a competitive world exit is less effective than voice in pushing firms to act in a socially responsible manner. Furthermore, we demonstrate that individual incentives to join an exit strategy are not necessarily aligned with social incentives, whereas they are when well diversified investors are allowed to express their voice. We discuss what social and legal considerations might sometimes make exit preferable to voice.

This talk is part of the Finance Seminars, CJBS series.

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