Introduction

Abstract

In this book I study how the separation of ownership and management changes industrial organization. I begin with an examination of the mindsets of the owner and the manager. I notice an obsession with market share, rather than profit. I explain why that comes about, in light of behavioral economics and cognitive psychology. Then I examine four bodily symptoms of the obsession: too big, too complex, too fragile, and too similar. (I call them “The 4 Toos.”) I suggest how they lead to epidemics such as waves, bubbles, and chaos. Finally, I draw the reader’s attention to countervailing forces: corporate raids, antitrust, and creative destruction. In industrial organization, I see these forces as antibodies offering shining rays of hope.