Social value of the firm: analyses and practical applications

• Rocardo Correia ^[1]
  1. [1] Universidad Carlos III
• Localización: Revista de economía aplicada, ISSN 1133-455X, Vol. 23, Nº 68, 2015, págs. 39-60
• Idioma: inglés
• Enlaces
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• Resumen

  • This paper analyses the social value of a firm considering different objec- tive functions in a real options perspective. Our results show that the socially optimal investment policy is not Pareto optimal, but significant gains in the value (generated by a firm) can be obtained by departing from a strict share- holder maximizing objective. Taking into account the role of supporting businesses, this paper develops a simple cost benefit framework that serves as a tool for assessing public investment incentive policies