Study Finds Common Ownership Dulls CEO Motivation and Weakens Competition
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Research shows common ownership among companies can weaken competition, as big investors own stakes in rival firms.
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This common ownership makes CEO pay and company performance less linked, reducing incentives.
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Less motivated CEOs may lead to higher prices and less innovation if competition decreases.
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Policymakers should focus on CEO incentives at major corporations to address issues from common ownership.
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Individual investors may unknowingly contribute to less competition by investing savings in funds with common ownership.