Benjamin Braun Profile picture
Feb 14 7 tweets 8 min read
Thank you, @adam_tooze! Couldn't have wished for a more cracking summary of my thoughts on asset manager capitalism. I'll take the opportunity for a brief 🧵on recent work on the topic by stars such as @adribuller, @MadisonECondon, @franziscooi, @lenorepalladino & @NataschaZwan.
Someone who knows everything about index funds, ESG, and climate is @adribuller. Her recent @DissentMag piece on private climate finance is excellent and has links to her other work. Incredibly, Adrienne is writing two (2) books, both scheduled for 2022. dissentmagazine.org/article/the-li…
The sharpest mind on all things universal owner, externalities, fiduciary duty, and other asset manager incentives, legal or otherwise, surely is @MadisonECondon. "Externalities and the Common Owner" is an instant classic (also on my #IPEofMoFi syllabus). scholarship.law.bu.edu/cgi/viewconten…
.@lenorepalladino, lawyer *and* economist ("that progressive economist” – @BernieSanders) knows US corporate governance inside out. She publishes killer articles *and* is a key voice in policy debates, from curbing stock buybacks to public asset managers.
journals.sagepub.com/doi/abs/10.117…
We haven't even talked about alternative asset managers. On European venture capital, I highly recommend @franziscooi's work. Her first article on this recently came out in @RIPEJournal (open access), more is in the making. tandfonline.com/doi/full/10.10…
Then there's asset owners, especially pension funds. The towering figure here is, obviously, @NataschaZwan. She & colleagues are currently doing a lot of exciting work on the democratic governance of funded occupational pension schemes: deepen-norface.eu
We'd all be completely clueless, of course, without financial journalists. Over the years I've learned a ton from @AttractaMooney and @kayewiggins, for instance, and I've been reading a lot @KateAronoff and @leee_harris recently.

That's it – end of Chartbook #82 addendum.

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More from @BJMbraun

Dec 8, 2021
China will prohibit its firms from using variable interest entities (VIEs) in offshore jurisdictions. What, you ask.

@m_maggiori et al have done incredible work showing the giant impact of VIEs on bilateral investment positions. Quick IPE data explainer.
academic.oup.com/qje/article-ab…
FT visual on VIEs. To deal with this, Coppola et al. match "the universe of traded securities issued by firms in tax havens with their issuer’s ultimate parent" to restate bilateral investment positions.

The issue: So far, data on bilateral positions has been residency-based.
Residency-based: US Treasury International Capital (TIC) & IMF Coordinated Portfolio Investment Survey (CPIS) -> red columns

Coppola et al. use firm-level securities data to restate this as nationality-based positions -> purple

Restatements are huge for bonds & equities.
Read 8 tweets
Dec 6, 2021
For New Labor Forum I wrote about what’s wrong with funded pensions. It's a crucial question for many countries, and yet the debate is often confused.

I focus on one issue: Pension funds are financialization machines.

Open-access link & a short 🧵
journals.sagepub.com/doi/10.1177/10… Image
Some context: The dream of wielding labor’s capital in the interest of workers is old, see Barber/Rifkin 1978.

And it's true that capital stewardship has often delivered results for US workers, see @DavidWebber's excellent Labor’s Last Best Weapon.
hup.harvard.edu/catalog.php?is… ImageImage
But there are structural reasons why, despite the best meso-level efforts, at the macro-level the weapon is bound to misfire.

As @ewaldeng once put it, pension funds are structurally pressured to "push the envelope", investment-wise.
journals.sagepub.com/doi/abs/10.106… Image
Read 11 tweets
Jun 23, 2020
What is asset manager capitalism? (How) does index fund dominance change the political economy of corporate governance?

This has taken me forever. It's a first working paper, focused on the United States. Brief summary below. 1/
osf.io/preprints/soca… ImageImageImage
The #CorpGov literature remains in thrall to what I call the Berle-Means-Jensen-Meckling ontology: Shareholders, while dispersed and weak, are the owners and principals of the corporation.

The rise of asset managers has pulled the empirical rug from under the BM-JM ontology. 2/ Image
The table summarizes
- the evolution of the US investment chain
- the hallmarks of historical corporate governance regimes

It shows the similarities (green) and differences (red) btw Hilferding’s late 19th century ‘finance capitalism’ and what I call asset manager capitalism. 3/ Image
Read 9 tweets

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