Week InReview: January 19, 2018

Happy Anniversary Modigliani-Miller

"June 2018 will mark the 60th anniversary of the publication of Franco Modigliani and Merton Miller's classic article, 'The Cost of Capital, Corporation Finance, and the Theory of Investment.' Widely hailed as the foundation of modern finance, their article, which purports to demonstrate that a firm's value is independent of its capital structure, is little known by lawyers, including legal academics. That is unfortunate, because the Modigliani-Miller capital structure irrelevancy proposition (when inverted) provides a simple, but powerful framework that can be extremely useful to legal academics, practicing attorneys, and judges."

The Modigliani-Miller Theorem at 60: The long-overlooked legal applications of finance's foundational theorem - The CLS Blue Sky Blog

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