(Solved):Did the moral hazard problem with investment banks get better or worse since the 80s? View Answer…

 

Question

Did the moral hazard problem with investment banks get better or worse since the 80s?

 

EXPERT ANSWER

Before the 80s, most investment banks were privately operated. The owners of the investment banks were responsible for their management. Since the 80s, only some investment banks have gone public meaning that they have become more susceptible to the moral hazard problem. The managers managing the banks are different from the owners and they do

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