What are the problems with the new power of fund companies and which new control mechanisms are required in order not to jeopardise competition? These are some of the questions debated in the guest article in the German newspaper FAZ written by Axel Ockenfels (Professor of Economics at the University of Cologne) and Martin Schmalz (Assistant Professor at the University of Michigan in Ann Arbor).
The authors therein plead among other things for „transparency provisions and a consistent merger control in fund componies which considers and states the investments in portfolio companies”:
„Whether major fund companies finally turn out to be a blessing or a curse will depend on if it will work out to stop the observed trend to highly concentrated ownership rights in the hands of fewer influential companies in time. First of all the role of science is to raise awareness for this.”
The guest article can be found here (in German): http://www.faz.net/aktuell/wirtschaft/wirtschaftswissen/fondsgesellschaften-schaden-dem-wettbewerb-14361696.html