A shareholder theory of firm and a stakeholder theory of firm may differ in their respective evaluation method of firm performance may differ in their respective evaluation method of firm performance. Both theories however recognize the importance of value creation as the economic role of firms as institutions. The New Institutional Economics (NIE) emphasizes incentives alignment, while also viewing stakeholder engagements as methods to expand the boundaries of firms.
Article first published in “Economics Research International”, 2012, Article Id. 142910, doi: 10.1155/2012/142910, as open access article, distributed under the terms of the Creative
Commons Attribution License.