On Dividends and Agency Problems

02/29/2004 Mises Wire Robert Blumen

The investing public’s disdain for dividends and fascination with capital growth has a precedent. In our last great bubble, the 1920s, the same thing happened. Why should companies pay out dividends? It is a way for the management to prove that they are really earning the cash that they claim to be. It is one way of overcoming the “agency problem” that is created when management works for share holders. William Bernstein reviews a number of empirical studies that show that managements usually do a poor job of reinvesting earnings internally. [article]

What Is The Mises Wire?

Mises Wire offers contemporary news and opinion through the lens of Austrian economics and libertarian political economy.

Submitting articles to Mises Wire

Reprints, Permissions and Copyrights

The views expressed on Mises Wire and mises.org are not necessarily those of the Mises Institute.

Subscribe to the Mises Wire RSS feed

Latest Articles

Republicans Aren’t Actually Interesting In Shrinking Government

11/25/2025 Mises Wire Connor O'Keeffe

The excitement of DOGE's early days has mostly dissipated, in large part because Republicans still completely accept the fallacious paradigm of their progressive opponents about how all these government programs are providing necessary services for the American people.

Frédéric Bastiat: The Unseen Role of Intermediaries

11/25/2025 Mises Wire Ulrich Fromy

Bastiat emphasized that much of what goes on in the economy involves things we don’t see directly. Intermediaries often fall into Bastiat’s category of things “not seen.”

Intellectual Property Laws Violate the (Free) Market

11/25/2025 Power & Market Alejandro A. Tagliavini

No one can legitimately create a monopoly on ideas. The problems of freedom are solved with more freedom and worsened with less.

History Is Not a Science

11/24/2025 Mises Wire Wanjiru Njoya

Some modern historians claim they are “doing science.” However, Ludwig von Mises in Theory and History decried what he saw as “scientism” instead of real scientific inquiry.

We’re Approaching the “Blame the Consumer” Stage of the Boom-Bust Cycle

11/25/2025 Mises Wire Ryan McMaken

In a recession or a crisis, the right approach for individuals is to save. So too for the national economy. Saving does not cause the economy to fall into recession any more than more spending can save it from recession.

Meet the Writer

Robert Blumen

Robert Blumen is a software engineer and podcast editor. Send him email.

AI Lacks the Entrepreneurial Intelligence to Plan an Economy

09/10/2023 Robert Blumen

Despite what many elites believe, AI can do many things, but it cannot successfully plan an economy. It lacks the intelligence of an entrepreneur.

AI Lacks the Entrepreneurial Intelligence to Plan an Economy

08/12/2023 Mises Wire Robert Blumen

Despite what many elites believe, AI can do many things, but it cannot successfully plan an economy. It lacks the intelligence of an entrepreneur.

Subscribe to our Mailing Lists

What is the Mises Institute?

The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard.

Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.

Become a Member