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Rejecting The Marie Antoinette Paradigm Of Prejudgment Interest, Royce De R. Barondes
Rejecting The Marie Antoinette Paradigm Of Prejudgment Interest, Royce De R. Barondes
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This paper examines principles for properly computing prejudgment interest by examining the impact on different corporate constituencies. This paper concludes that prejudgment interest at a promisor's cost of funds can undercompensate promisees, by shifting value from the promisee's equityholders to its creditors through a forced investment that decreases the risk of the promisee's portfolio of assets.