Dirk Hackbarth

Conventional wisdom suggests that rollover risk is simply a maturity problem: the sooner your debt comes due, the more exposed you are, especially if there are near-term maturity towers. If that were the entire story, then maturing debt should weigh heavily on a firm's largest decisions.

Dirk Hackbarth, Alejandro Rivera, Tak-Yuen Wong 19 December 2018 For decades, academics and practitioners alike have argued that companies do not implement long-term strategies and that shareholders must cure the disease of short-termism to maximise shareholder value. This column examines the perils of short-termism in the context of investment policies and managers’ incentivisation.

Research by Dirk Hackbarth and Bart Taub shows the potential to merge in the future increases competition prior to merging. Hence–in contrast to the conventional view–mergers can indeed be pro-competitive. According to the market power doctrine, the concentration of output among firms in an industry is a measure of market power in that industry. More market power is synonymous with monopoly: prices increase and output falls, to the detriment of consumers and to society at large.